1 day ago
The Nifty 50 index breached the 23,000 mark intra-day for the first time since June 2024. The index witnessed heavy selloff on Tuesday after fluctuating within a broader range over the last six sessions. It closed the day lower by 320 points at 23,025, just above the critical 23,000 mark.
The Sensex, on the other hand, shed as much as 1,230 points during the session.
After opening on a positive note, the market failed to sustain its initial gains, showing weakness as the session progressed. Volatility spiked sharply during the mid-to-late part of the day, and the market ended at a six-month low amid extreme volatility.
Frontline indices declined by 1-2%, driven by continued selling from foreign institutional investors (FIIs), uncertainty around Donald Trump’s proposed tariff policies, and weaker-than-expected Q3 results from several companies.
Broader markets faced heavy selling pressure, with the Nifty Midcap100 and Smallcap100 indices falling over 2% each. At one point, the benchmarks saw a sharp rebound, climbing past the 23,400 mark. However, selling resumed shortly after during a highly volatile 30-minute stretch post-noon.
With today's drop, investor wealth worth over ₹7 lakh crore was wiped out.
All sectoral indices ended in the red, with Nifty Realty leading the losses, plunging over 4% due to growth concerns and uncertainty regarding the Reserve Bank of India's (RBI) interest rate policy.
Stocks like Zomato, MCX, Oberoi Realty, Dixon Technologies saw big earnings reaction, falling 10-15%.
Investors remain cautious ahead of heavyweight HDFC Bank's Q3 results, set to be reported on Wednesday. Along with HDFC Bank, stocks like HUL, BPCL, will also be reporting their results on tomorrow. Additionally, midcap IT stocks, including Coforge and Persistent Systems, are expected to be in focus as they announce their quarterly earnings.
Negative sentiments in the market were further fueled by Donald Trump’s remarks targeting BRICS nations. He reiterated his intention to impose 100% tariffs on countries reducing their reliance on the US dollar for global trade. Global markets are also intimidated by expectation of an interest rate hike by the Bank of Japan (BOJ) in its upcoming decision on Friday, which could impact borrowing costs globally.
Analysts now predict that markets will remain under pressure in the near term, weighed down by mixed quarterly earnings and persistent FPI selling.
What do the Nifty 50 charts indicate?
According to Nagaraj Shetti of HDFC Securities, the underlying trend of Nifty has turned down sharply after a small upside bounce. The next lower support to be watched around 22,800 levels and any pullback rally could find strong resistance around 23,200 levels.
LKP Securities' Vatsal Bhuva said that selling pressure continues to limit recoveries, and the follow-up move will be key to confirming further downside. A close below 23,000 could push the index toward pre-election levels of 22,500, with immediate resistance at 23,300.
"The broader structure of lower highs and lower lows remains intact, indicating the continuation of the downtrend. Nifty also slipped below its 9-day EMA, suggesting weakening short-term momentum," said Om Mehra, Technical Analyst, SAMCO Securities.
