Stock Market Faces Heavy Losses as Sensex Drops Over 800 Points, Nifty Sinks More Than 1%

Mumbai, January 27 – The Indian stock market experienced a sharp downturn on Monday, with both Sensex and Nifty witnessing steep declines as investor sentiment soured due to global and domestic challenges.

The Sensex plunged by 824.29 points, ending the day at 75,366.17, while the Nifty tumbled 263.05 points to close at 22,829.15. The market’s breadth was largely negative, with only 8 Nifty-listed companies advancing, 42 declining, and one remaining unchanged.

Among the few gainers, stocks like Britannia, ICICI Bank, M&M, Hindustan Unilever, and SBI managed to stay in the green. However, heavyweights such as HCL Tech, Tech Mahindra, Wipro, Hindalco, and Shriram Finance recorded substantial losses, emerging as the day’s top losers.

Key Factors Behind the Decline
Vinod Nair, Head of Research at Geojit Financial Services, attributed the market’s downturn to broad-based selling across sectors. He stated, “The sell-off was driven by weak corporate earnings, expensive valuations in the mid- and small-cap segments, and subdued global sentiment. Foreign institutional investors (FIIs) have been net sellers due to slower economic growth and the Indian rupee’s depreciation.”

Adding to the woes, geopolitical uncertainties and ongoing global trade tensions, including a fresh dispute involving the US and Colombia, weighed heavily on investor confidence. The upcoming Federal Open Market Committee (FOMC) meeting, expiry week for derivatives, and anticipation surrounding the Union Budget further amplified market volatility.

Impact of Rupee Depreciation
VLA Ambala, a SEBI-registered research analyst and co-founder of Stock Market Today, highlighted the Indian rupee’s depreciation as a critical factor affecting market performance.

“The Indian rupee has depreciated significantly over the past few months due to factors such as a widening trade deficit, elevated crude oil prices, and a stronger dollar index following the Federal Reserve’s indication of limited rate cuts in 2025,” she explained.

She added, “The Nifty index has dropped nearly 13% from its peak, maintaining a bearish trend. Meanwhile, the rupee has weakened by 2.97% against the US dollar over the last three months. To curb further depreciation, the Reserve Bank of India (RBI) intervened in the forex market, using USD 77 billion from its reserves to stabilize the currency.”

Outlook for the Week Ahead
With uncertainties looming over global and domestic markets, analysts predict a challenging week ahead for investors. Market volatility is expected to persist as traders remain cautious ahead of key economic events, including the Union Budget and global monetary policy updates.

The ongoing sell-off has underscored the need for resilience amid economic headwinds, with both global and domestic factors continuing to influence market dynamics.

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