Stock Market Today: Sensex Falls 500 Points, Nifty Slips Below 25,100 - What Dragged the Markets Down Today?

Indian stock market fell sharply today on Thursday, July 24 after a significant rise yesterday. Both key indices, the Sensex and Nifty 50, saw significant losses during the trading session. Lingering uncertainty over US-India trade negotiations further weighed on market sentiment, pushing it to end in red. The decline was mainly driven by weakness in IT, realty, and FMCG.

The Sensex dropped 542.47 points or 0.66% to close at 82,184.17, while the Nifty 50 declined 157.80 points or 0.63% to 25,062.40. The BSE Mid-cap and small-cap idices also fell about 0.5% during the session.

Top Gainers And Losers:

Top losers included Trent, Nestle India, Shriram Finance, Tech Mahindra, Reliance Industries, and Infosysy. Axis Bank, HCL Tech, Bharat Electronics (BEL), and Kotak Bank, while Eternal, Dr Reddy's Labs, Tata Motors, Tata Consumers, Cipla and Grasim were among the top gainers on the Nifty.

Amongst the sectoral indices, Nifty Financial Services, Nifty Bank, and Metal emerged as major gainers, playing a crucial role in the Nifty's rebound. On the other hand, Oil & Gas, PSU Banks and FMCG faced the steepest declines, contributing significantly to the overall market fall.

The Nifty Midcap 100 Index gained 0.62% while Nifty smallcap 100 Index underperformed the Benchmark where it ended flat. Market breadth remained negative, with declining stocks outnumbering advanced ones on the BSE, as indicated by an advance - decline ratio of 0.90.

Why Did the Market Fall Today?

Indian markets were shaken on Thursday due to a mix of concerns. Weak Q1 earnings from several companies disappointed investors, while U.S. President Donald Trump's unexpected visit to the Federal Reserve raised eyebrows and added to market nervousness. Adding to the uncertainty was the lack of clarity around a potential trade deal between the U.S. and India, which further dampened investor sentiment.

"Indian equities fell sharply today, reversing previous gains despite positive global cues. Initial optimism around the India-UK free trade agreement gave way to caution as attention shifted firmly to earnings.

The IT and FMCG sectors dragged down large-cap stocks due to subdued Q1 performance. Though the Q1 earnings are broadly in line, it does not justify the premium valuation; India is trading at a 3-year high of 21x P/E," said Vinod Nair, Head of Research, Geojit Investments.

Nifty Outlook:

"For the last two trading sessions, Nifty has been giving respect to 50 days EMA support, currently placed at 24938 levels. Today's recovery from the crucial support and close on a strong note increases the chance of further up move in Nifty going ahead. Traders should cut shorts and initiate fresh longs with 24900 stoploss in Nifty. On the higher side 25255 could offer immediate resistance," said Nandish Shah - Deputy Vice President, HDFC Securities.

"The Nifty slipped lower as it faced stiff resistance around the 25,250-25,260 zone. On the hourly chart, the index fell back below the 50-EMA and closed below it. Overall, the index continues its range-bound movement, which may persist in the near term.

On the downside, support remains intact at 24,900; a decisive break below this level could trigger a correction in the market. On the other hand, a sustained move above 25,260 may induce a fresh rally," said Rupak De, Senior Technical Analyst at LKP Securities.

Rupee VS Dollar

The Indian rupee ended almost flat on Thursday at 86.40 per dollar, compared to its previous close of 86.41.

"After six consecutive days of declines, the Indian rupee found stability against the US dollar, primarily due to long unwinding of dollar positions. Despite this stabilisation, the local currency remains a median performer among its Asian counterparts, while the greenback has strengthened against the major currencies.

The upcoming US trade tariff deadline will be closely watched for its potential impact on trade flows and currency movements. Technically, the spot USDINR pair is expected to find support at 85.90, with resistance noted at 86.65," Dilip Parmar - Senior Research Analyst, HDFC Securities.

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