Nifty fall since October 2nd biggest in 10 years; 16 stocks tank over 20%

The Nifty has declined nearly 12% in the last four months. The NSE index has witnessed six significant price corrections in the last one decade, excluding the COVID-related panic sell-off; shows data.

The Nifty50 index that has slipped 11.6 per cent in four months (since October 2024), has seen its second biggest fall in the last 10 years, excluding the fall triggered by the black swan event Covid, shows data. The index had logged a life-time high at 26,277 in September 2024, before ending the month at 25,939 levels.  Excluding the Covid-19 panic sell-off in March 2020, the current fall in Nifty is the second worst in a decade. According to Ace Equity data, the Nifty registered its biggest market correction in the March 2015 - February 2016 period in the last 10 years, as the index cracked 21 per cent.  Including the current market correction, there have been six instances wherein the Nifty 50 index has dropped 7 per cent or more. 

 

  Till date, the present correction now stands as second largest in terms of percentage, with 4 more trading sessions to go this month. Prior to this, the market fell during the November 2021 to June 2022 period - wherein the Nifty shed 10.7 per cent - its second biggest fall till then.  "The recent sharp market correction is in the backdrop of earnings not coming through amid weak economic fundamentals and a reset of expectations. That said, the longer term story remains intact. However, everything –comes at a price, which the FIIs are not willing to pay, especially in the mid-and small-cap baskets. To that extent, large-caps are becoming attractive again," said Vaibhav Sanghavi, chief executive officer at ASK Hedge Solutions.  From a short-term perspective, Sanghavi believes the market sentiment could be dictated by the measures / policies unveiled in the upcoming budget.    "There has been a laser focus on capex from the government in the last 10 years. It needs to be seen where the policy thrust is from the government now – capex versus consumption. All this needs to be balanced with the resources," Sanghavi adds.  At the bourses, meanwhile, what makes the fall more painful for investors is the number of stocks that have tumbled and the quantum.  As many as 16 Nifty 50 stocks have tumbled over 20 per cent in the current market fall, data shows. This number is higher as compared to the other four stock market corrections, barring the 2015-16 fall, in the last 10 years.  Among individual stocks, IndusInd Bank has been among the top losers, slipping over 34 per cent in the last four months. That apart, Asian Paints, Bajaj Auto and Hero MotoCorp have also crashed around 30 per cent each, ACE Equity data shows.    BPCL, Trent, NTPC, Shriram Finance, Adani Enterprises, Coal India, Tata Motors, Adani Ports, Tata Steel, Axis Bank and Hindustan Unilever (HUL) are the other prominent laggards in the Nifty50 pack, down over 20 per cent each since October 2024.  The markets, according to Deven Choksey, managing director of DRChoksey FinServ, are currently oversold, which in itself could act as a trigger for the Nifty to rebound. He expects the Nifty to find support around 22,400 levels; below which he fears the market could capitulate and the NSE benchmark could slide towards 21,800 levels.    On the valuation front, he believes that the market seems fairly priced at current levels, but investors need to be selective while buying stocks.  In the near-term investors are likely to seek cues from the US Federal Reserve meeting outcome on Wednesday night, followed by the monthly derivatives expiry on Thursday and the Union Budget on Saturday.