Since the market downturn that began in September 2024, driven by global uncertainties, earnings downgrades, and persistent FII (Foreign Institutional Investor) selling, the indices faced sustained pressure. The situation further intensified earlier this month with Trump’s tariff announcements reigniting trade war concerns, pushing the index to a 52-week low of 21,281.
However, since hitting that low, the market has shown signs of resilience and has begun a recovery, reflecting improving sentiment and potential stabilization in global cues.
Nifty 50 is down by 0.80 percent or 190 points, recovering a little from its day low of 23,847. Nifty Smallcap 250 is down by 2.25 percent or 360 points. Further, the Advance decline ratio shows that only 293 Stocks are trading in Green and 2,253 stocks are trading in Red.
Reasons for the Market Falling Today
The primary reason can be attributed to the escalation in diplomatic tension between India and Pakistan, and the potential firing by Pakistan near the Line of Control (LOC), breaking the ceasefire agreement between India and Pakistan. Escalation between the two countries is because of the Pahalgam terror attack and India’s response to the attack.
Nifty in the past 12 days has rallied from a low of 21,743 to a high of 24,359, which is an increase of 2,616 points or 12.03 percent. Any negative news after such a significant rally can lead to investors and traders booking profits on their investments and positions and exiting their positions. Which leads to a fall in share prices and more sellers are there compared to Buyers.
FIIs too have been Net buyers for some time after continuous selling in the Indian Stock Markets. FIIs are very quick in churning their portfolios and positions, and as there is an escalation between 2 Nuclear nations, and the potential of further escalation is always there, it could lead to Foreign portfolio holders exiting their position.
Written By Abhishek Das
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