The Indian stock market has been witnessing a continuous decline since last week, primarily due to the U.S. Federal Reserve’s decision to cut interest rates. On December 18, the U.S. Federal Reserve reduced its benchmark interest rate by 25 basis points to 4.25-4.50%, which has had a significant impact on the Indian market. Following this decision, the U.S. market also saw a sharp decline, and the effects were felt in Indian markets as well. In the past five trading sessions, investors in the Indian stock market have lost ₹17 lakh crore. On the last trading day of the week, the market experienced further losses, with investors losing ₹9.1 lakh crore.
This decline in the Indian stock market last week was the largest weekly drop in the past two years. The Sensex fell by 1.49%, dropping 1,176 points, closing at 78,041.33 points. Meanwhile, the Nifty also fell by 320 points, closing at 23,631.25 points, which represents a 1.34% decline. The main reason for this drop is the U.S. Federal Reserve’s decision, along with continued selling by foreign investors in the Indian market.
Another significant factor contributing to the decline in the Indian market is the selling activity by Foreign Institutional Investors (FII). Over the past four sessions, FIIs have sold Indian stocks worth more than ₹12,000 crore, negatively impacting market sentiment. Additionally, economic factors such as a stronger dollar and rising bond yields have further worsened the market situation.
Despite the overall market decline, a few stocks saw slight gains, including Nestle India and Titan. However, the majority of stocks in the Sensex witnessed a fall, including major companies such as ICICI Bank, ITC, Asian Paints, Maruti, HCL Tech, Sun Pharma, Hindustan Unilever, and Kotak Mahindra.
This decline has created challenges for the Indian market, and investors hope for improvement in the market conditions in the coming days. However, the decisions made by the U.S. and the actions of foreign investors may continue to impact the market in the future.
