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Terrible Tuesday! Sensex sinks 1,400 pts; why are stock markets falling?

Stock market today: The Nifty fell below 23,000 in intraday trade today, with heavyweights like RIL, SBI, Bajaj Finance, ICICI Bank, HDFC Bank, Bharti Airtel, and Maruti Suzuki all declining

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Nikita Vashisht New Delhi

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Stock market crash, stock markets today: India stock markets today gave up their morning gains to trade significantly lower in Tuesday’s intraday trade. The BSE Sensex today crashed 1,432 points to hit an intraday low of 75,641.87. The NSE Nifty today, too, tumbled 367.90 points to hit a low of 22,976.85 level.   At close the BSE Sensex finished off 1235.08 points lower or 1.60 per cent down to settle at 75,838.36, while NSE Nifty50 settled at 23,024.65 with a loss of 320.10 points or 1.37 per cent
 
Dragging the benchmark indices today were large-cap stocks like Zomato, Adani Ports, Reliance Industries (RIL), State Bank of India (SBI), Bajaj Finance, ICICI Bank, Tata Steel, and Bharti Airtel. These stocks were top Sensex losers today, down up to 11 per cent at the time of writing this report.
 
 
In the broader markets, the Nifty MidCap and SmallCap indices declined around 1.6 per cent each. Market breadth is extremely negative with the advance-decline ratio showing two stocks falling for every one stock rising in the market.

Here are the key reasons why stock markets fell today, Jan 21:

 

Profit booking in heavyweights

Sensex, Nifty heavyweights like RIL, SBI, Bajaj Finance, ICICI Bank, Kotak Bank, HDFC Bank, Bharti Airtel, and Maruti Suzuki were trading weak on Tuesday.
 
Reliance Industries stock, which has the highest weight of about 11.5 per cent in the Sensex index, declined over 2.5 per cent in intraday trade, and accounted for 14.5 per cent of today’s fall in the index.
 
HDFC Bank, the second highest stock by weight, slipped 0.8 per cent in trade and accounted for 10 per cent of today’s decline in the index.
 
ICICI Bank and SBI stocks, the next biggest index contributors, were down up to 3 per cent.
 

Weak Q3 earnings

Investor sentiment turned sour as Q3 results season, thus far, has been underwhelming for most companies.
 
Zomato, which was the biggest stock loser on the Sensex index today with a loss of over 11 per cent, reported a 57 per cent Y-o-Y slide in net profit at Rs 59 crore for the October-December quarter (Q3FY25). Sequentially, profit was down 66.5 per cent. Analysts, too, have cut the stock’s target price and earnings estimate, factoring-in higher opex and lower profitability in the near-term amid focus on Blinkit’s expansion. READ MORE
 
Dixon Technologies, the other stock that reported its Q3 results after market hours on Monday, plummeted nearly 14 per cent in trade amid stretched valuations. READ HERE
 
Paytm stock (down around 8 per cent), Oberoi Realty stock (over 7 per cent), Newgen Software stock (10 per cent), and MCX stock (8 per cent) were some of the other broader market stocks, which suffered investor wrath post their Q3 results.
 
Overall, the net profit (adjusted for exceptional gains & losses) of the 162 early-bird companies, which reported their earnings till last Friday, was up 8.7 per cent year-on-year in Q3FY25, an improvement from a 6.2 per cent growth in Q3FY24 and 4.4 per cent Y-o-Y growth in Q2FY25. READ MORE

Donald Trump 2.0

After taking oath as the 47th President of the United States, Donald Trump said he was considering levying 25 per cent import tariffs on Mexico and Canada as early as February 1.
 
Further, Trump said he was toying with the idea of hitting China with intensified tariffs over social media site TikTok.
 
While the newly sworn-in President gave a temporary reprieve to the social media company, he said the extension of the same will likely depend on the owner finding a US partner. Should China not agree to that, I could use a tariff as a persuasion tool, Trump said.  "This lack of definitive action on tariffs spurred caution among investors, who remain vigilant for further announcements that might reshape global trade," said Justin Khoo, Senior Market Analyst - APAC, VT Markets.
   

Technical Levels

According to analysts at Reliance Securities, the Nifty has been trading in a range of 23,100-23,400 levels. On the lower side, the support of 23,000 will now act as a reversal point, below which there could be some sharp profit booking in index pivotal.
 

FII selling:

Foreign institutional investors have been on a selling spree since October, 2024. Thus far in January, 2025, they have already sold stocks worth Rs 48,023 crore.
 

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First Published: Jan 21 2025 | 11:40 AM IST

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