The domestic equity market on Tuesday, January 23, saw a terrible Tuesday falling to a one-month low, as the BSE Sensex crashed over 1,000 points and the NSE Nifty plummeted over 330 points.
On Tuesday, the Sensex tumbled 1,053.10 points to settle at 70,370.55, while the Nifty fell 330.15 points to 21,241.65. Out of the 30 companies on Sensex, 25 stocks saw a decline.
Among the top losers were IndusInd Bank, State Bank of India, Hindustan Unilever, HDFC Bank and Bajaj Finance declining up to 5.97 per cent. There were six gainers also — Sun Pharma, Bharti Airtel, ICICI Bank, Power Grid, Bajaj Finserv, and TCS — rising between 4 per cent and 0.03 per cent.
Why Did Sensex Tank Today?
Vinod Nair, head (research) at Geojit Financial Services, said, “The market witnessed a continuous decline today, abruptly turning negative despite a positive start, mainly due to substantial selling in heavyweight sectors, particularly finance. Mid- and small-caps witnessed more decline compared to the main indices.”
He added that selling by FIIs due to reasons like high valuation and mixed results for the earnings season so far, along with recent escalations in tensions in the Middle East and Red Sea, prompted the investors to book profit from the recent rally. “Going forward, markets are likely to witness stock-specific actions during the ongoing earnings season.”
Prashanth Tapse Senior Vice-President (Research) at Mehta Equities said, “Despite positive momentum in the global market, selling pressure continued today in the domestic markets mainly on the back of news that is worrying FII as Sebi drafted paper to impose tightened ultimate beneficial ownership norms for overseas investors with effect from February 1. This was despite pressure from foreign banks and few offshore fund managers to ease the rules ahead of the deadline.”
If this stands true, domestic markets may see more selling in the range of Rs 1.5 lakh crore to Rs 2 lakh crore over the next six months, he said.
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