Why Stock Market Is Falling Today?

Sensex Crashes 1,400 Points, Nifty Slips Below 25,400 — 5 Key Reasons Behind Market Selloff

Sharp Market Fall: Sensex and Nifty Under Pressure

Indian equity markets turned sharply lower during the intraday session, erasing early gains and slipping decisively into negative territory. The Sensex dropped more than 1,400 points, or over 1.7%, to trade near 82,300, while the Nifty declined over 400 points to hover around the 25,400 mark. Weak global cues, cautious institutional flows and rising volatility contributed to the broad-based selloff.

1️⃣ Weak Sentiment and FII Selling Pressure

Market sentiment remained fragile as foreign institutional investors showed signs of renewed caution after the earnings season. The inability of the Nifty to sustain above key psychological levels has added to investor nervousness, keeping traders on the defensive despite intermittent buying support.

2️⃣ Rising Global Geopolitical Risks

Investor confidence has been impacted by increasing geopolitical uncertainty, particularly reports of potential escalation involving the United States and Iran. Any developments affecting crude oil prices or currency markets tend to amplify risk aversion, leading to profit booking across global equities, including India.

3️⃣ Broad-Based Selloff Across Market Segments

The decline was not limited to frontline stocks. Mid-cap and small-cap indices also slipped, indicating widespread weakness across sectors. The fall resulted in a significant erosion of overall market capitalisation, reflecting cautious investor positioning amid uncertainty.

4️⃣ Valuation Concerns in Mid- and Small-Cap Stocks

Although mid- and small-cap stocks had recently shown signs of recovery following the third-quarter earnings season, elevated valuations continue to be a concern. Large-cap stocks still offer relatively better valuation comfort, making the current market environment more selective and stock-specific rather than broadly bullish.

5️⃣ Sectoral Weakness and Rising Volatility

Most sectoral indices traded lower, with notable declines in auto, FMCG, media and realty stocks. Financials, metals and consumer durables also remained under pressure. Adding to the cautious tone, the India VIX jumped sharply, signalling rising volatility expectations and heightened investor anxiety in the near term.

Market Outlook

The surge in volatility and continued global uncertainty suggest markets may remain choppy in the short term. Traders are likely to remain cautious until clearer direction emerges from global developments and institutional flow trends, while stock-specific opportunities may continue to dominate in the current environment.