Dalal Street’s benchmark indices remained under heavy pressure on Thursday, with sustained selling dragging markets deeper into the red through the afternoon session.
At the closing bell, the Sensex was down 1236.11 points at 82,498.14, while the Nifty50 had slipped 365 points to 25,454.35. The losses have deepened further, signalling sustained and aggressive selling rather than a temporary dip.
So what drove today’s steep fall on Dalal Street?
BROAD-BASED SELLING ACROSS SECTORS
The decline is not confined to a single pocket of the market. Selling has been visible across banking, financial services, energy and capital goods stocks.
Heavyweights such as Reliance Industries, HDFC Bank, ICICI Bank, Kotak Mahindra Bank and Larsen & Toubro remained under pressure, putting significant weight on the indices.
Even defensives like Hindustan Unilever and ITC Limited saw declines, adding to the broad weakness. When large companies fall together, benchmark indices tend to drop sharply because these stocks carry high weightage in index calculations.
Only a few names, including Infosys and Tata Consultancy Services earlier in the day, managed marginal gains, but the support was not strong enough to alter market direction.
PROFIT BOOKING
Another key factor behind today’s decline is profit booking.
After recent rallies, some investors are choosing to lock in gains. Profit booking simply means selling shares at higher levels to secure returns.
Once this selling gathers pace, it can trigger further automated and technical selling, especially when key market levels are breached.
As more traders exit positions, intraday declines can intensify, which is what the market has witnessed through the afternoon.
GLOBAL UNCERTAINTY
Global cues are also adding pressure. Investors worldwide remain cautious amid rising geopolitical tensions, particularly the escalating US–Iran situation, which has increased volatility across global markets.
Vinod Nair, Head of Research at Geojit Financial Services, said the sell-off was driven squarely by the sharp deterioration in global risk sentiment.
“The bears took charge of the Indian market as rising geopolitical tensions between the US and Iran unsettled global sentiment, leading to a broad-based sell-off. Brent crude surged to its YTD high, exacerbating inflationary concerns and triggering heightened volatility on fears of a bottleneck in the Strait of Hormuz,” Nair said.
A fresh NOTAM (Notice to Air Missions) issued over Iranian airspace warns pilots to avoid the region due to possible rocket activity, underscoring the seriousness of the situation. Such developments typically push global investors into risk-off mode.
“At the same time, uncertainty around the US Fed’s rate-cut trajectory and continued weakness in the INR weighed on domestic equities. The sell-off intensified due to low FII participation amid Lunar New Year holidays across key Asian markets and a non-settlement day owing to a regional banking holiday in India,” he added.
When uncertainty spikes, investors reduce exposure to equities and shift money into safer assets such as gold or government bonds. This behaviour often weighs on emerging markets, including India.
WHAT SHOULD INVESTORS WATCH?
At this stage, the fall appears to be driven by a combination of broad sector weakness, profit booking and fragile global sentiment rather than signs of a structural breakdown.
However, markets are sensitive to uncertainty. If heavyweight sectors continue to slide and global sentiment stays weak, volatility is likely to persist in the near term.
For investors, the key is to avoid panic decisions. Sharp intraday swings are common when sentiment turns fragile. The broader market direction will become clearer once indices test key support levels and buying interest either stabilises the decline or weakens further in the coming sessions.
