Sensex drops 800 pts, Nifty tests 25k; what's driving the D-St crash?

Stock market down today: Indian equity markets took another steep plunge on Friday, with the Nifty and Sensex on course to end the week the worst in over months. 

 

On Friday, the Nifty index fell as much as 0.99 per cent, or 248 points, to 25,041, while the 30-stock Sensex slipped 1 per cent, or 818 points, to 81,489. At close, BSE Sensex was at 81,537.7, down 769.67 points or 0.94 per cent and NSE Nifty50 quoted 25,048.65, down 241.25 points or 0.95 per cent.

 

Since hitting a life high on January 5 this year, the Nifty has fallen by 5 per cent, while the Sensex is down 4,300 points from the same date. On a weekly basis, Nifty and Sensex are down 2.4 per cent and 2.3 per cent, respectively.

 

During the session, the market breadth remained weak on the BSE. Out of 4,269 stocks traded on the BSE, 1,259 advanced versus 2,861 declines, underscoring broad-based selling beneath the index level. Around 149 stocks remained flat.

 

All sectors were seen trading with losses on Tuesday, with Realty (down 3.3 per cent) and Media (down 2.5 per cent), leading the fall. 

 

Following a day of long relief rally, the Nifty index is witnessing renewed selling pressure due to a sharp decline in Adani Group and banking and finance stocks, Vipin Kumar, assistant vice president, technical and derivatives research, Globe Capital Markets, said. "Chart structure is negative as Nifty is still trading in lower highs and lower lows formation. Immediate supports around 24,900-24,800 spot zone and resistance are around 25,500 spot levels."

 

Why are Indian stock markets falling?

Adani stocks under pressure: The steep fall in the market came amid a slide in Adani group shares as reports showed that the US Securities and Exchange Commission (US SEC) seeks alternative pathway to advance stalled Adani fraud case. 

 

Adani Green Energy slipped 10 per cent, while Adani Energy Solutions and Adani Enterprises tumbled 9 per cent, each.  Adani Total Gas and Adani Power were also down over 7 per cent, each. 

 

After failing to serve Gautam Adani with a legal summons for more than a year, the US SEC wants a judge to clear a way for the agency to advance with its fraud case against the Indian billionaire, Bloomberg reported. The SEC’s lawsuit, filed in November 2024, alleges that Gautam and Sagar Adani violated US securities laws by making false and misleading representations about Adani Green Energy Ltd. 

 

FPI selloff: Foreign portfolio investors (FPIs) continued to offload Indian equities with a total selling of ₹31,334 crore so far this month. This comes after FPIs ended 2025 with a net selling of ₹1.66 trillion. 

 

The pattern of sustained FII selling and DII buying which dominated  the market trend in 2025 has been continuing in 2026, too, so far,  VK Vijayakumar, Chief Investment Strategist, Geojit Investments, said. "Whether this pattern will change with FIIs also turning buyers is the important question which investors have been asking for sometime now. Partly the Budget to be presented on February 1st will offer some insights, if there are some market-friendly proposals." 

 

Tepid Q3 results: The earnings of early-bird companies in October-December 2025 (Q3FY26) have shown just single-digit growth in revenue despite gains from cuts in goods and services tax (GST) rates, marking the worst performance on earnings by these early-bird companies in at least 17 quarters. The trailing earnings per share of the BSE Sensex was up just 1.3 per cent year-on-year (Y-o-Y) so far — the lowest since April 2021. 

 

Geopolitical tensions: Although concerns over potential US control of Greenland have eased, tensions continue to prevail on Dalal Street. US President Donald Trump stepped back from threats to impose tariffs on Europe that were set to take effect on February 1, and announced reaching a "framework" deal over Greenland. 

 

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