Afternoon Market Report: Sensex at 75,432 and Nifty at 22,850 as global concerns and FPI sales drag down indices

In mid-day trade, the BSE Sensex saw a sharp drop of 788 points, or 1.00 percent, to 75,432.65. The NSE Nifty followed suit, slipping 238.05 points or 1.03 percent, and stood at 22,850. The weak outlook continues to prevail, with many domestic and global factors causing confusion for investors. Zomato Ltd was the worst performer on the Sensex, shedding 2 percent and trading at Rs 211.

Foreign Portfolio Investor (FPI) sales continue to weigh on markets

One of the major causes of inflation today is the continued outflow of foreign currency. Since January, FPIs have withdrawn Rs 69,000 crore from Indian markets, a trend that has largely overshadowed the buying by Domestic Institutional Investors (DIIs), who have invested Rs 67,000 crore during the same period. This continuous sale of FPI creates a negative atmosphere, and the confidence of investors is further eroded.

Global concerns: Trade tensions and tariff fears

The continuing turmoil in global trade is another key concern. The market remains cautious due to new threats from the administration of US President Donald Trump, including the imposition of a 25 percent tariff on Colombian goods. With similar threats to Mexico and Canada, investors are aware of potential disruptions to global trade. Analysts suggest that this global uncertainty is causing increased risk aversion among investors.

Quarterly earnings and pre-budget jitters

Market participants are also anxiously awaiting the Union Budget 2025, scheduled for February 1, and the Reserve Bank of India’s monetary policy decision next week. Mixed quarterly earnings added to the uncertainty, and profit bookings are being watched as investors prepare for the budget. Other sectors, such as IT and metal stocks, have been hit hard, as concerns about global economic growth continue.

Looking ahead: What’s next for markets?

As the market continues its downward spiral, experts suggest that the Union Budget will play a key role in shaping investor sentiment. Analysts are hoping for a fiscal stimulus with income tax cuts, which could provide a much-needed boost. However, if these expectations are not met, the market may face further selling pressure. The next few days will remain important as markets await announcements from the US Federal Reserve and the Indian government.

Key stocks to watch:

• Zomato Ltd, IndusInd Bank, Adani Ports, Tata Motors, Infosys, Tech Mahindra, NTPC, HCL Technologies – all faced heavy losses, with many of these stocks falling more than 1 percent each one.