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The Sensex, on the other hand, shed as much as 1,230 points during the session.
After opening on a positive note, the market failed to sustain its initial gains, showing weakness as the session progressed. Volatility spiked sharply during the mid-to-late part of the day, and the market ended at a six-month low amid extreme volatility.
Frontline indices declined by 1-2%, driven by continued selling from foreign institutional investors (FIIs), uncertainty around Donald Trump’s proposed tariff policies, and weaker-than-expected Q3 results from several companies.
Broader markets faced heavy selling pressure, with the Nifty Midcap100 and Smallcap100 indices falling over 2% each. At one point, the benchmarks saw a sharp rebound, climbing past the 23,400 mark. However, selling resumed shortly after during a highly volatile 30-minute stretch post-noon.
With today’s drop, investor wealth worth over ₹7 lakh crore was wiped out.
All sectoral indices ended in the red, with Nifty Realty leading the losses, plunging over 4% due to growth concerns and uncertainty regarding the Reserve Bank of India’s (RBI) interest rate policy.
Stocks like Zomato, MCX, Oberoi Realty, Dixon Technologies saw big earnings reaction, falling 10-15%.
Investors remain cautious ahead of heavyweight HDFC Bank’s Q3 results, set to be reported on Wednesday. Along with HDFC Bank, stocks like HUL, BPCL, will also be reporting their results on tomorrow. Additionally, midcap IT stocks, including Coforge and Persistent Systems, are expected to be in focus as they announce their quarterly earnings.
Negative sentiments in the market were further fueled by Donald Trump’s remarks targeting BRICS nations. He reiterated his intention to impose 100% tariffs on countries reducing their reliance on the US dollar for global trade. Global markets are also intimidated by expectation of an interest rate hike by the Bank of Japan (BOJ) in its upcoming decision on Friday, which could impact borrowing costs globally.
Analysts now predict that markets will remain under pressure in the near term, weighed down by mixed quarterly earnings and persistent FPI selling.
Foreign investors continued to remain net sellers in the cash market on Tuesday, while domestic investors were net buyers.
What do the Nifty 50 charts indicate?
According to Nagaraj Shetti of HDFC Securities, the underlying trend of Nifty has turned down sharply after a small upside bounce. The next lower support to be watched around 22,800 levels and any pullback rally could find strong resistance around 23,200 levels.
LKP Securities’ Vatsal Bhuva said that selling pressure continues to limit recoveries, and the follow-up move will be key to confirming further downside. A close below 23,000 could push the index toward pre-election levels of 22,500, with immediate resistance at 23,300.
“The broader structure of lower highs and lower lows remains intact, indicating the continuation of the downtrend. Nifty also slipped below its 9-day EMA, suggesting weakening short-term momentum,” said Om Mehra, Technical Analyst, SAMCO Securities.
Given the severity of the sell-off, the ongoing weakness is likely to persist, with the support from the falling wedge pattern appearing fragile around 22,900, according to Rajesh Bhosale of Angel One.
“Should this level break, the next support zone would be seen at 22,800–22,700. On the upside, resistance levels continue to shift lower, with the previous support at 23,200 now acting as the immediate hurdle, while 23400 remains a stiff barrier,” Bhosale added.
What do the Nifty Bank charts indicate?
The Nifty Bank ended the session at 48,570.90, registering a decline of 1.58%.
Although the index attempted to move higher, the previous resistance levels proved to be stronger, and the index lost momentum. The broader structure of lower highs and lower lows remains intact, signaling the continuation of the downtrend. The index remain below key moving averages, suggesting persistent weakness in the short term.
The swing low remains at 47,898, and a break below this level could trigger further declines in the index. The immediate resistance remains at 49,500, which could limit any potential upward movement, Mehra said.
Here are the stocks to watch ahead of Wednesday’s trading session:
– Tata Technologies: Net profit down 1% year-on-year at ₹168.6 crore from ₹170 crore last year. Revenue up 2% at ₹1,317 crore from ₹1,289.5 crore last year. EBITDA fell 1.1% to ₹234 crore, compared to ₹236.6 crore, while margin stood at 17.8%.
– IndiaMART: Net profit up 47.6% year-on-year at ₹121 crore versus ₹82 crore. Revenue up 16% at ₹354.3 crore versus ₹305.3 crore YoY. EBITDA up 61.4% at ₹138.3 crore versus ₹85.7 crore YoY. Margin stood at 39%.
– JSW Group signs MoU with Maharashtra government for ₹3-lakh crore investment in the state. The investment will be made in diverse sectors including steel, renewable energy, cement, battery manufacturing and electric vehicles.
– Drug firm Neuland Laboratories Ltd on Tuesday (January 21) announced that its board of directors approved capital expenditures totalling ₹342 crore for capacity expansion at its facilities in Telangana.
– Cyient DLM: Net profit down 40.8% year-on-year at ₹10.9 crore from ₹18 crore last year. Revenue up 38% at ₹444 crore. Margin came in at 6.1% from 9% last year.