Sensex plunges 380 points, Nifty below 24,480 as markets close lower

Markets close in the red

Indian equity benchmarks ended Tuesday's session deep in the red, with the BSE Sensex sliding over 380 points and the NSE Nifty50 closing below the 24,480 mark. The sell-off, which gathered pace through the afternoon, wiped out early gains and left investors nursing losses across most sectors.

The Sensex, which opened on a shaky note, struggled to find footing as the day progressed. The Nifty50, too, mirrored the downturn, settling at its lowest close in recent sessions. Market breadth was negative, with more stocks declining than advancing on both exchanges.

What dragged the indices

While the exact triggers behind Tuesday's decline were not immediately clear, traders pointed to a mix of global cues and profit-booking at higher levels. Weakness in Asian markets and uncertainty over global interest rates weighed on sentiment, prompting institutional investors to trim positions.

Heavyweight stocks in banking, IT, and auto sectors were among the top drags on the indices. Midcap and smallcap shares also felt the heat, as risk appetite took a backseat. Analysts noted that the absence of any positive domestic catalyst left the market vulnerable to external pressures.

Sectoral performance

• Banking and financial services: Led the decline, with major lenders losing ground.
• Information technology: Witnessed selling ahead of quarterly earnings announcements.
• Auto and FMCG: Ended lower on weak demand concerns.
• Oil & gas and metals: Managed to limit losses, offering some support.

Investor sentiment and volumes

Volumes on the exchanges were moderate, with no panic selling visible. However, the sustained downward bias suggested that institutional investors were not in a hurry to buy the dip. Retail participation, too, appeared cautious, with many waiting for clarity on the direction of global markets.

Foreign institutional investors (FIIs) and domestic institutional investors (DIIs) were net sellers in the cash market, according to provisional data. The rupee, meanwhile, held steady against the US dollar, providing little relief to equity traders.

What to watch next

Market participants will now turn their attention to upcoming domestic and international economic data, including inflation prints and central bank commentary. Any surprise on the policy front could set the tone for the next leg of the market.

Analysts advise caution, noting that volatility is likely to persist in the near term. With the Nifty below 24,480, the next support levels will be closely tracked. For now, traders are bracing for more swings as they await fresh triggers to guide their next moves.