India’s stock markets Sensex and Nifty have recently entered a technical correction phase with a 10% drop from their peaks in September. When an index falls 10% from its high, it’s considered a “correction.” A 20% decline would shift it to a bear market.
Market Decline Overview
Both the BSE Sensex and NSE Nifty closed at their lowest levels in nearly five months on Wednesday driven by concerns over slowing corporate earnings and global uncertainties. The Nifty closed down by 324 points at 23,559, while the Sensex lost 984 points ending at 77,691. This decline is the steepest in the past week with both indices down around 3%.
Foreign and Domestic Activity
Foreign portfolio investors have sold large amounts of stock worth ₹2,502 crore on Wednesday alone, contributing to a net foreign outflow of ₹23,570 crore this month. In contrast, domestic investors purchased ₹6,145 crore in shares partially cushioning the market.
Sectoral Impacts and Inflation
High consumer inflation, reaching 6.2% in October dampened investor confidence especially since it limits the chance of near-term interest rate cuts. Key sectors saw substantial declines: Nifty Realty dropped 3.2%, Bank Nifty fell 2.1%, and Nifty PSU Bank lost 3.1%.
Mid-cap and Small-cap Performance
Mid-cap and small-cap stocks experienced sharper falls with their indices dropping 2.7% and 3.1% respectively. Both indices hit their lowest since June with mid-caps down by 6.1% and small-caps by 7.5% over the past week.
Technical Analysis: What’s Next for Nifty?
The Nifty index is approaching its 200-day moving average at 23,550, a critical support level. Analysts warn that breaching this level could push it down to 23,000, entering bear market territory. Although mild rebounds are possible, experts suggest caution as overall sentiment remains negative.
With persistent inflation, foreign investor sell-offs, and sluggish corporate earnings, Indian markets are navigating a challenging phase. Whether the 200-day moving average holds could be key in determining the market’s direction going forward.
- Accident
- Auto
- Blog
- Bollywood
- Business
- Civic
- Crime
- Culture
- Education
- Environment
- Fitness
- Food
- Health
- Humanity
- Icons of Mumbai
- International
- Legal-Judiciary
- Mens' World
- Mumbai
- National
- Navi Mumbai
- Nutrition
- Politics
- Religion
- Social
- Society
- Technology
- Tourism
- Transport
- Web story
- Wierd News
- Women's World
