Following Trump’s inauguration speech, the Sensex and Nifty crashed; why is the Indian stock market declining on January 21?
On Tuesday, January 21, the Indian stock market gave up its gains after opening higher and saw a highly unfavourable trading environment. The show follows Donald Trump’s inauguration address, in which he signed a number of executive orders without announcing any stringent trade regulations. The Nifty 50 fell by around 113 points, and the Sensex fell by more than 443 points. 77,200 and 23,400 have been removed from both benchmarks. The Indian benchmarks show a decline of around 1% in percentage terms.
Sensex price
The Sensex was down 814.81, or 1.06%, at 76,258.63 at the time of writing. To reach an intraday low of 76,224.79, the benchmark dropped as much as 849 points. Top gainers were Ultratech Cement, HCL Tech, and ITC, but the gain was only 1%. The biggest bears, which had declines of 1% to 10%, were Zomato, Adani Ports, Reliance, NTPC, SBI, and ICICI Bank.
As of today, January 21, the market capitalization of BSE-listed businesses has fallen by about Rs 3.66 lakh crore to Rs 427.93 lakh crore, down from the previous day’s m-cap of Rs 431.59 lakh crore. Out of the 3,691 equities that were traded on the BSE, 1,998 saw a loss, 1,512 saw an increase, and 181 saw no change. The BSE Sensex Next 50 and BSE Bankex both fell 445 and 698 points, respectively.
Nifty 50 Price
The Nifty is now down 184.40 points, or 0.79%, at 23,160.35. The benchmark fell below 23,200 levels to reach an intraday low of 23,127.70 after wiping out its intraday high of 23,426.30. So far in the day, the Nifty has dropped 217 points overall. Bank Nifty fell 492 points, or 1%, while Nifty Next 50 fell 2%. The volatility index for India fell 5%.
The Nifty Smallcap 100 and Nifty Midcap 100 indexes both saw selloffs of up to 1.6%. Every sectoral index went into deep red. The Nifty Consumer Durables index received a severe battering from bearish, plunging 3.2%, and the Nifty Realty index fell 2.9%. Each of the following stocks saw a greater than 1% decline: Nifty Auto, Nifty Financial Services, Nifty PSU Bank, Nifty Private Bank, Nifty Metals, and Nifty Oil & Gas.
The 47th president of the largest economy in the world, Donald Trump, takes the oath of office. Trump promises American citizens that he would restore the nation’s sovereignty and make it even more powerful, magnificent, and remarkable than it was in his January 20 speech. “America’s decline is over” he declared with assurance, making fun of the former Joe Biden administration. On January 20, Trump will be inaugurated, and vice president Vance will be the first person in his government to take the oath of office.
According to Trump, the ‘Golden era of America’ is about to begin! Trump promised to restore the safety of the nation’s citizens and return its sovereignty. The justice scales will be rebalanced, he declared. He told the audience that building a proud, wealthy, and free country will be the primary focus of his administration.
Trump 2.0 has begun with little certainty over his potential economic choices, according to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. He was explicit on immigration in his inaugural speech, but he seemed evasive about tariffs. The prospect of 25% tariffs on Canada and Mexico implies that the policy of tariff hikes would be enacted gradually. In response, the 10-year bond yield dropped to 4.54% and the dollar index dropped to 108.43 on the currency market.
This is the quintessential instance of “buying on rumors and selling on news,” Vijayakumar continued. Additional postponements of tariff increases are probably going to devalue the dollar and lower bond rates. India and other rising markets would benefit if this occurs.
However, a recovery in India’s GDP growth and business profits is necessary if FII flows to the country are to turn positive on a regular basis. “That’s the important macro data to keep an eye on,” Vijayakumar continued.
With Rs. 50,912.60 crores sold so far in January, the unprecedented outflow of foreign institutional investors is a big concern, according to Prashanth Tapse, Senior VP (Research), Mehta Equities. Focused equities include Dixon Technologies, which had a 124% YoY increase in net profit, Zomato, whose shares fell 7.27% after Q3 earnings, and MCX, which reported solid Q3 earnings. Although Trump’s tariff choices continue to be a wild card, the Nifty is anticipated to trade with a bullish tilt.
Disclaimer: The information in the aforementioned article is news and educational in nature; it is not a suggestion for a purchase or sale. Before making any financial decisions, users are advised by TraderPulse to consult with qualified professionals.
