The Indian stock market witnessed another downturn on Tuesday. Investor sentiment remained negative amid weak signals from foreign markets and rising concerns about tariffs. The Nifty closed down nearly 73 points at 24650, while the Sensex fell by more than 300 points.
Discussions of a trade war have intensified once again. Concerns about the US raising tariffs on imports have caused anxiety among global investors. The Indian market has not been immune to this. The impact was also felt on midcap and smallcap stocks, which remained under pressure throughout the day.
Banking Index Under Most Pressure
The banking sector contributed significantly to the market decline. The banking index fell by about half a percent and closed at the 55400 level. While the market saw some recovery on Monday, there was no significant improvement in Bank Nifty on Tuesday.
Experts say that heavy short positions have been built up in banking stocks, which has exacerbated the impact of the decline. Selling pressure was particularly evident in public sector banks and mid-sized private banks.
FII Selling Continues to Be a Concern
Selling by foreign institutional investors (FIIs) shows no sign of stopping. According to experts, foreign investors are withdrawing money from Indian markets and investing in countries where they see the prospect of better returns. This is directly impacting the domestic market.
According to Anuj Singhal, Managing Editor of CNBC Awaaz, the major trend of the market has weakened, and until foreign investors return, such declines may continue.
Companies' Results Have Been Mixed So Far
Although some sectors have seen good quarterly results from companies, the market has not found much relief from this. IT, Pharma, and FMCG companies have performed reasonably well, but banking, auto, and metal stocks have performed below expectations.
Gurmeet Chadha, Managing Partner at Complete Circle, said that the results of the past few days indicate stability in domestic consumption-based companies. However, global uncertainties and tariff-related news have weakened market sentiment.
Increased Uncertainty Regarding Tariffs
Tensions are once again building up between the US and China regarding tariffs. Donald Trump's statements have once again raised fears of a global trade war. Experts believe that India will be indirectly affected, and this effect is already visible in the stock market.
According to Saurabh Mukherjea of Marcellus Investment Managers, the environment surrounding tariffs has increased fear in the market. He said that the pharma sector currently looks better because it is slightly less affected by global policy fluctuations.
Uncertain Environment Still Exists for Traders
Market analyst Ashish Baheti stated that both Nifty and Bank Nifty are still under pressure. Stability cannot be expected in the market until a clear trigger is found.
According to him, if the market continues to decline, the Nifty could soon slip to the 24450 level. At the same time, the 55100 level could become a crucial support for Bank Nifty. If this level is also broken, there is a possibility of a further decline.
Risky Environment in the Market
According to market experts, taking overnight positions may be risky at present. There are very few stocks in the market that show stability. In such a situation, traders are focusing on small profits and avoiding taking long positions.
The decline in Nifty reflects the sentiment of the entire market. Experts believe that the market is now completely dependent not only on the results of companies but also on global events. Therefore, even small news items are now starting to shock the market.
