Risk-off sentiments deepen as Sensex tumble 873 pts, Nifty below 24,700

Stock Market Closing Bell, Tuesday, May 20, 2025: Extending the losing streak to a third consecutive day, Indian equity benchmark indices settled sharply lower on Tuesday amid lack of fresh triggers in domestic markets and weak global cues. 

Moody’s downgrading of the US sovereign rating and renewed concerns around rising coronavirus (Covid–19) cases weighed over investor sentiment.

 

The Sensex closed at 81,186.44, down by 872.98 points or 1.06 per cent. The Nifty50 closed at 24,683.90 levels, down by 261.5 points or 1.05 per cent.

 

Vinod Nair, head of research at Geojit Investments said that with the lack of major positive triggers and prevailing uncertainty over US fiscal stability, investors opted for profit-booking and adopted a cautious stance.  

Echoing similar views, Ajit Mishra, senior vice president for research at Religare Broking said​ the decline reflects rising caution among market participants in the absence of any major domestic triggers and amid global uncertainties. 

 

“Intermediate volatility in the US markets and concerns over the potential impact of the US-China trade deal on foreign institutional inflows into emerging markets, including India, also weighed on sentiment” he added.

 

The broader markets also followed the leading indices. The BSE Midcap index settled 1.65 per cent lower, pulled by fall in Emami (-4.7 per cent), Schaeffler India (-4.14 per cent), Zee Entertainment (-4.12 per cent), Astral (-4 per cent), Rail Vikas Nigam (-3.64 per cent), Coromandel International (-3.6 per cent), and Aditya Birla Fashion & Retail (-3.57 per cent).

 

BSE Smallcap fell 0.96 per cent, pulled by fall in Ganesh Benzoplast (-15 per cent), Nucleus Software Exports (-8.8 per cent), Doms Industries (-8.17 per cent), Cochin Shipyard (-8.1 per cent), Dhunseri Ventures (-7.7 per cent), and Jayaswal Neco Industries (-7.5 per cent). 

  All the sectoral indices settled lower with Nifty Auto, Financial Services, FMCG, Media, Pharma, Realty, and Healthcare down by over 1 per cent each. Among others Nifty Bank, Energy, IT, Metal, Consumer Durables and Oil & Gas fell in the range of 0.5 to 1 per cent. 

 

Nifty Auto emerged as top sectoral laggard, down 2.17 per cent, due to heavyweights like Hero MotoCorp, Bajaj Auto, Maruti Suzuki, TVS Motor, Eicher Motor, and Bharat Forge falling over 2 per cent each.

 

Among Sensex constituents, 27 out of 30 stocks settled lower, falling up to 4.1 per cent. The top losers included Eternal, Maruti Suzuki, M&M, Ultratech Cement, and Power Grid. The gainers included Tata Steel, Infosys and ITC.

 

“Given the current premium valuations and delays in the trade deal, we foresee a phase of short-term consolidation, which may lead FIIs to scale back their positions in the domestic market,” Nair said.  According to Mishra, investors should not overreact to the recent dip and instead wait for clearer signals. “While the breach of the 24,800 mark in Nifty has dampened near-term momentum, the short-term trend remains positive as long as the index holds above the 24,400 level decisively. In the meantime, we advise traders to avoid aggressive long positions and focus on sectors or themes that are showing relative strength,” he said.