Domestic stock markets faced significant selling pressure on Thursday, driven by declines in tech-heavyweight stocks, lackluster global cues, and weak performance in Asian markets. Both major indices recorded notable losses, with the Nifty 50 at the National Stock Exchange (NSE) closing at 23,914.15, down 360.75 points, and the BSE Sensex ending at 79,043.74, shedding 1,190.34 points. This marks a decline of over 1% in both benchmarks during the day’s session.
Key Drivers Behind the Downturn
Market experts pointed to multiple factors behind the sell-off:
US Policy Concerns:
Investor sentiment was dampened by uncertainty surrounding US President-elect Donald Trump’s anticipated economic policies, particularly regarding the trajectory of US interest rates.
Weak Global Cues:
The absence of significant international market movements, exacerbated by the Thanksgiving holiday closure of US stock markets, left investors with little directional guidance.
Domestic Focus:
With the Indian Union Budget 2025 approaching, domestic institutional investors (DIIs) remained cautious, awaiting clarity on fiscal and economic reforms.
Geopolitical Pressures:
Concerns over geopolitical developments, such as anti-dumping measures in the steel sector and trade disputes involving China’s solar components, have added strain to the broader economic outlook.
Currency and FPI Flows:
The rupee’s ongoing depreciation has spurred foreign portfolio investor (FPI) outflows, further pressuring equities.
Sectoral Snapshot
Sectoral indices on the NSE painted a broad picture of decline:
Major Declines: Banking, Auto, Financial Services, FMCG, IT, Metals, Private Banks, Pharma, Realty, Healthcare, Consumer Durables, and Oil and Gas all closed in the red.
Positive Performers: Media and PSU Banks stood out as exceptions, managing to close in positive territory.
Top Gainers and Losers
Despite the market downturn, a few stocks managed to deliver gains:
Gainers:
Losers:
Expert Insights
Vinnaayak Mehta, Founder of The Infinity Group, explained, “The market is under pressure due to the absence of international cues, FII selling, and geopolitical tensions. Additionally, the strong US dollar is dampening sentiment.”
VLA Ambala, Co-Founder of Stock Market Today, highlighted, “Weak growth indicators, rupee depreciation, and strained trade relations are key concerns. FPI outflows are likely to continue until the rupee stabilizes.”
Looking Ahead
Analysts urged caution, noting that today’s declines were influenced by lower trading volumes linked to the US Thanksgiving holiday and the monthly F&O expiry.
Ajay Bagga, a market and banking expert, stated, “Expiry-day volatility is amplifying market movements. With the new series starting tomorrow, we expect a rebound as trading normalizes.”
What’s Next?
As the market heads into the next trading cycle, investors are expected to closely monitor domestic and global developments, including policy announcements, currency movements, and global market trends. The focus will also shift towards cues from the upcoming Union Budget, which is anticipated to shape market sentiment in the weeks to come.
