Indian Stocks Plunge 2.5% Amid Global Jitters, FII Exodus

All sectoral indices ended in the red this week, with Realty logging the worst-performance, dipping 11.33 per cent. Consumer durables, telecom, and consumer discretionary sectors went down over 5 per cent.

Nifty dipped 2.51 per cent during the week and 0.95 per cent on the last trading day to 25,048. At close, the Sensex was down 769 points or 0.94 per cent at 81,537. It dipped 2.43 per cent during the week.

Broader indices posted stronger losses during the week, with the Nifty Midcap100 down 4.58 per cent while Nifty Smallcap100 declined 5.81 per cent.

Bank Nifty ended the week with a firmly bearish technical tone after a decisive breakdown below the crucial 58,800 support.

Analysts said that the early-week sentiment found some support from earnings upgrades at select IT and banking stocks, but earnings disappointments that came later, with muted results from sectoral peers, weighed on market sentiments.

Escalating geopolitical tensions - particularly around the U.S. administration's aggressive posturing on Greenland and tariff threats - unsettled global markets, culminating in a broad-based sell-off across domestic equities.

Further, rising global bond yields and uncertainty surrounding the US Supreme Court's review of Donald Trump-era tariffs further restrained risk-taking.

Since January 1 2026, both the Sensex and the Nifty have declined over 4 per cent. The global risk-off environment has prompted aggressive selling by foreign portfolio investors, who have offloaded equities worth over Rs 36,500 crore during the month.

The Indian rupee has slipped to near 92 per US dollar, amplifying concerns around imported inflation.

Investors are keeping an eye ahead for cues from Union Budget 2026 and guidance from the Fed on the trajectory of interest rate cuts.

Analysts maintain that elevated FII short positions, oversold momentum indicators, and pre-Budget positioning could trigger bouts of short covering.

However, durability of any recovery is likely to remain contingent on global cues, earnings follow-through, and investor positioning ahead of the Union Budget, they added.

- IANS