Stock Market Slips After Strong Opening: Sensex Falls 250 Points — Here Are the 5 Key Reasons

After opening on a positive note, the Indian equity market lost momentum as the session progressed, leading to sharp intraday losses for investors. The BSE Sensex slipped 250.48 points, or 0.30%, to close at 83,627.69, while the Nifty50 declined 57.95 points, or 0.22%, to settle at 25,732.30.

At one point during the day, the Sensex had plunged more than 900 points from its intraday high, highlighting renewed volatility in the market. The Nifty also fell over 1% during intraday trade before recovering partially by the close.

Shares of Trent and Larsen & Toubro fell more than 3%, while Reliance Industries declined over 1%. The market had started the day on an optimistic note, supported by hopes of a US trade deal and encouraging early earnings from IT majors TCS and HCL Technologies. However, the initial rally failed to sustain, with selling pressure intensifying in the second half of the session.

Five Key Reasons Behind Tuesday’s Market Decline

1. Profit Booking in Heavyweights

Selling pressure returned in large-cap stocks, dragging the market lower. Shares of Reliance Industries fell nearly 2%, reversing the previous day’s gains. The stock had already declined 7.4% last week after the company indicated it would not receive Russian crude oil supplies in January, prompting investor caution.
The IT sector also weighed on the market, with the IT index slipping 0.4%. HCL Technologies fell 2%, while TCS ended marginally lower.

2. Rising Crude Oil Prices

Higher crude oil prices added to market concerns. India, being a major importer of crude oil, is particularly sensitive to price fluctuations. Ongoing tensions in Iran pushed oil prices higher amid fears of supply disruptions.
US President Donald Trump’s warning of a 25% tariff on countries trading with Iran further escalated geopolitical uncertainty. Brent crude rose 57 cents, or 0.9%, to $64.44 per barrel, hovering near a two-month high.

3. Continued FII Selling

Persistent selling by foreign institutional investors (FIIs) continued to pressure Indian equities. On Monday alone, FIIs sold shares worth ₹3,638 crore. Sustained foreign fund outflows have weighed heavily on benchmark indices, intensifying losses amid global uncertainty and keeping investors cautious.

4. Weakening Rupee

The decline in the Indian rupee further dented investor sentiment. The currency weakened on Tuesday, primarily due to subdued equity market performance and delays in India’s inclusion in a major global bond index. Although intervention by the Reserve Bank of India helped limit the fall, currency weakness added to market pressure.

5. Weak Technical Signals

From a technical perspective, the market attempted a rebound from lower levels but overall momentum remained weak. Analysts pointed to key support and resistance levels that are likely to determine near-term direction, with heightened volatility keeping traders on edge.

Outlook

Market participants remain cautious as global cues, crude oil prices, foreign fund flows, and currency movements continue to influence sentiment. Analysts advise investors to stay selective and closely monitor macroeconomic and geopolitical developments in the coming sessions.