Indian Stock Market Falls: Sensex Drops 1,000 Points, Nifty Down 300 Points
New Delhi, India – Indian stock indices slumped sharply on Monday, with Sensex falling over 1,000 points and Nifty dropping about 300 points. Key sectors like banking, auto, financial services, and realty were among the top losers.
Market expert Ajay Kedia from Mumbai explained that the decline is due to continued profit booking, geopolitical tensions in the Middle East, and fresh Chinese stimulus attracting foreign direct investments (FDIs).
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted, “Market is likely to move into a consolidation phase in the near-term. One significant factor influencing foreign portfolios is the outperformance of Chinese stocks, reflected in the massive surge in the Hang Seng index by around 18% in September.”
He added, “This means foreign institutional investors (FIIs) may continue to sell in India and move some more money to better-performing markets. However, FII selling is unlikely to impact the Indian market significantly since the massive domestic money can easily absorb whatever the FIIs are selling. Investors can use dips to buy quality large-caps which are fairly valued.”
On Friday, after six straight session highs, Indian stock indices closed the week’s trade marginally in the red due to profit booking. Prior to the latest slump, the US Federal Reserve’s monetary policy committee had loosened interest rates by 50 basis points, supporting Indian stocks. Foreign portfolio investments in the Indian stock market remained positive for the fourth consecutive month.
Doubts Revealed
Sensex -: Sensex is a short form for the Bombay Stock Exchange Sensitive Index. It is a measure of the 30 largest and most actively traded stocks on the Bombay Stock Exchange in India.
Nifty -: Nifty is a short form for the National Stock Exchange Fifty. It is an index that represents the 50 largest and most actively traded stocks on the National Stock Exchange in India.
Stock indices -: Stock indices are like scoreboards that show how well a group of stocks are doing. They help investors understand the overall performance of the stock market.
Profit booking -: Profit booking means selling stocks to take advantage of the gains made when the stock prices were higher. Investors do this to secure their profits.
Geopolitical tensions -: Geopolitical tensions refer to conflicts or issues between countries that can affect the global economy and stock markets. In this case, it refers to problems in the Middle East.
Chinese economic stimulus -: Chinese economic stimulus refers to actions taken by the Chinese government to boost their economy, like lowering interest rates or spending more on infrastructure.
Foreign investors -: Foreign investors are people or companies from other countries who invest money in India’s stock market. Their actions can influence the market’s performance.
Domestic investments -: Domestic investments are investments made by people or companies within India. These can help stabilize the stock market when foreign investors sell their shares.
Large-cap stocks -: Large-cap stocks are shares of big, well-established companies with a large market value. They are considered safer investments compared to smaller companies.
