Equity indices plummeted to their lowest levels in eight months on Monday, with the Nifty facing the threat of registering its longest losing streak since 1996, as concerns over weak US economic data and tariffs triggered a widespread market sell-off.
The BSE Sensex dropped by 856.65 points or 1.14 percent to close at 74,454.41, while the NSE Nifty 50 fell by 242.55 points or 1.06 percent to end at 22,553.35. Over the last five trading sessions, the BSE index lost 1,542.45 points or 2 percent, and the Nifty plummeted by 406.15 points or 1.76 percent.
If the Nifty closes February in the negative territory, it would mark its fifth consecutive monthly decline, a bearish trend last witnessed 28 years ago.
Leading the market decline were IT stocks, with the sector index declining by over 2 percent. Wipro emerged as the top loser, dropping by 3.70 percent, followed by HCL Technologies (-3.41 percent), TCS (-3.04 percent), and Infosys (-2.87 percent). Bharti Airtel also saw a decline of 2.39 percent.
“The market is more concerned about the US’s likely move to impose higher tariff levies on exporting nations, which could have an impact on developing countries including India,” said Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd.
Gold prices saw an uptick amidst the equity market weakness, rising by ₹150 to reach ₹86,175. Jateen Trivedi of LKP Securities noted that gold traded within a range, supported by Comex gold holding above $2,925 and moving towards $2,945. Additionally, rupee weakness provided further support to MCX gold.
The broader market sentiment remained largely negative, with declining shares outnumbering advancing ones by more than two to one on the BSE. Out of the 4,200 stocks traded, 2,810 saw declines while 1,207 advanced, and 183 remained unchanged. Notably, 283 stocks hit 52-week lows compared to just 61 touching 52-week highs.
Amidst the market turbulence, some sectors showed resilience. M&M led the gainers, rising by 1.54 percent, followed by Dr Reddy’s Laboratories (1.14 percent), Eicher Motors (1.09 percent), Hero MotoCorp (0.82 percent), and Nestle India (0.45 percent).
“Global headwinds persist in weighing on the domestic market, with ongoing volatility causing uncertainty among retail investors,” noted Vinod Nair, Head of Research at Geojit Financial Services. He added that weak US consumer sentiment and tariff concerns could further impact export-oriented sectors like IT.
The Indian rupee also weakened by 0.05 to 86.71 against the US dollar. Trivedi commented, “Rupee traded weak, pressured by a strong dollar index and FII sell-off in secondary markets.”
Foreign Institutional Investors (FIIs) sold equities worth ₹3,449.15 crore on Friday, according to exchange data. Total outflows from equity markets have surpassed ₹1 lakh crore in 2025, with foreign investors pulling out over ₹23,710 crore this month alone amidst rising global trade tensions.
Technical analysts foresee further weakness ahead. Rupak De, Senior Technical Analyst at LKP Securities, pointed out that the Nifty has broken down from a bearish flag and pole pattern, signaling the start of a correction. He identified immediate support at 22,450, with the potential for further decline towards 22,200 if this level is breached.
Looking ahead, market experts anticipate some relief. Nair stated, “The pace of earnings downgrades is expected to ease, supported by increased government spending, lower interest rates, and tax reductions. These factors are likely to provide a boost to sectors such as FMCG, consumer discretionary, and banking.”
The volatility index, India VIX, saw a slight decline of 0.60 percent to 14.44, indicating a slight easing in market fear levels despite the sharp decline in equity prices.
Global oil benchmark Brent crude inched up by 0.04 percent to $74.46 a barrel.
Gold traders will closely monitor the Core PCE Price Index, a key US economic indicator, this week. The precious metal faces resistance at ₹86,450-₹86,600 and has support at ₹85,500-85,200, according to Trivedi.
The article was published on February 24, 2025.
