Sensex falls nearly 400 points, Nifty 50 slips below 26,200 as profit booking weighs on Dalal Street

Market Performance: Sensex falls nearly 400 points, Nifty 50 slips below 26,200

The Indian stock market ended Tuesday’s session on a weak note, even as global cues stayed positive. Frontline indices slipped for the second straight day, showing signs of fatigue after recent highs.

The Sensex fell nearly 400 points, while the Nifty 50 slipped below the 26,200 mark, as investors chose to book profits and reduce risk exposure.

At its weakest point during the session, selling pressure deepened, but some stability returned toward the close.

• Sensex intraday low: 84,900.10
• Nifty 50 intraday low: 26,124.75

By the end of the session:

• Sensex closed at 85,063.34, down 376 points (0.44%)
• Nifty 50 settled at 26,178.70, lower by 72 points (0.27%)

The broader market also stayed under pressure.

• BSE Midcap index: down 0.24%
• BSE Smallcap index: down 0.39%

Despite positive moves across major Asian markets, domestic sentiment remained cautious throughout the day.

Main News: Why the Indian stock market declined today?

The fall in the Sensex and the slide of the Nifty 50 below 26,200 were driven by multiple overlapping factors rather than a single trigger. Investors appeared to be balancing optimism from global markets with domestic concerns.

Here’s how the story unfolded on Dalal Street.

Heavyweights pulled the indices down

Index-heavy stocks were a key drag on the market. Selling pressure in a few large names was enough to tilt the benchmarks lower.

• Reliance Industries fell nearly 5% intraday
• HDFC Bank declined over 2%

Because of their large weight in the indices, weakness in these stocks directly impacted both the Sensex and the Nifty 50.

Foreign capital outflow kept sentiment weak

Continuous selling by foreign institutional investors remained a key overhang for the market.

• Since July 2025, foreign investors have sold Indian equities worth nearly ₹1.85 lakh crore
• In the first three trading sessions of January, selling crossed ₹3,000 crore in the cash segment

This steady outflow has made investors cautious, especially during sessions when profit booking sets in.

Earnings season caution ahead of Q3 results

The December-quarter earnings season has begun, with several companies scheduled to announce results in the coming days.

• Some companies started declaring results on January 6
• Larger names like Avenue Supermarts (DMart) are due on January 10
• IT majors TCS and HCL Tech will report on January 12

With mixed corporate performance seen since mid-2024, traders appeared reluctant to take aggressive positions ahead of confirmed earnings numbers.

Fresh tariff-related concerns resurface

Global developments also added a layer of uncertainty.

Reports around fresh tariff warnings linked to India’s Russian oil imports introduced nervousness in the market. Any escalation on this front raises concerns around trade relations, which often reflect quickly in stock prices.

Geopolitical caution limits risk appetite

While ongoing global conflicts are not seen as an immediate threat to Indian markets, investors remained alert.

The possibility of escalation has pushed participants toward a more defensive stance, leading to reduced exposure to riskier stocks during the session.

Company-Level Details: How key stocks influenced the market

A closer look at stock-specific movement explains the index pressure.

• Reliance Industries: Sharp intraday decline of nearly 5%, dragging the benchmarks lower
• HDFC Bank: Fell over 2%, adding to downside pressure
• Broader stocks showed mild but steady selling across midcap and smallcap segments

The selling was selective but impactful, especially because of the weight of these companies in benchmark indices.

Market Wealth Impact: Investor value takes a hit

The day’s decline also reflected in overall market wealth.

• Total market capitalisation of BSE-listed companies slipped to about ₹479 lakh crore
• This was down from nearly ₹481 lakh crore in the previous session

In a single day, nearly ₹2 lakh crore in investor wealth was eroded due to broad-based selling.

Summary: Sensex falls nearly 400 points as caution dominates trade

The session was a clear reminder that markets don’t move in a straight line.

The Sensex falling nearly 400 points and the Nifty 50 slipping below 26,200 highlighted a phase of consolidation driven by profit booking, foreign fund outflows, earnings-related caution, and global uncertainty.

Even with positive Asian market cues, domestic factors took center stage. Until there is greater clarity on earnings trends and global developments, volatility may continue to define short-term market movements.

For now, Dalal Street appears to be catching its breath after recent gains, with investors choosing prudence over risk.

Source: Livemint