The Sensex plunged 1,045.46 points to close at 71,593.24, its lowest level in 33 months. FPIs sold shares worth Rs 12,943.58 crore, their biggest single-day outflow since May 29. Nilesh Shah, CEO, Kotak Mutual Fund, said the market was facing a barrage of bad news. Many stocks fell as nervousness grew.
The Sensex plunged 1,045.46 points, or 1.44%, to close at 71,593.24, its lowest level in 33 months. The Nifty sank 371.25 points, or 1.64%, to 22,231.80, a eighteen-month low.
FPIs sold shares worth Rs 12,943.58 crore ($ 1.3 billion). This was their biggest single-day outflow since May 29. Domestic institutional investors bought equities worth Rs 10,703.11 crore but failed to arrest the slide.
With today’s sales, FPIs have sold shares of Rs 2.92 lakh crore ($31.9 billion) since the beginning of the calendar year – the highest ever. In CY25, they had sold shares worth Rs 1.65 lakh crore ($18.8 billion).
Several domestic and global factors weighed on sentiment. The RBI’s decision to raise the repo rate by 25 basis points to 5.50% raised concerns over higher borrowing costs. Its shift to a calibrated tightening stance added to the nervousness.
Brent crude climbed above $104 a barrel amid geopolitical tensions and supply concerns. The US 10-year Treasury yield remained elevated at around 5.3%. Caution ahead of TCS’ quarterly results also weighed on technology stocks.
The sell-off mirrored weakness across Asian markets. Singapore led the losses with a 3.5% decline, followed by South Korea (2.62%) and the Philippines (2.20%).
The Sensex is now 16.91% below its all-time intraday high of 86,159.02 touched on December 1, 2025. The Nifty has fallen 15.70% from its record peak of 26,373.20 reached on January 5, 2026.
Nilesh Shah, CEO, Kotak Mutual Fund, said the market was facing a barrage of bad news. He cited “rising rates globally, weakening rupee, triple-digit oil prices, IPO supply, political protests, supply chain disruptions, below-average monsoon, lack of AI opportunities and FPI selling.”
The pain was sharper in the broader market. The Nifty Midcap 100 plunged 2.53%, while the Nifty Smallcap 100 lost 2.34%.
“The broader market witnessed even sharper selling, with both midcap and smallcap indices declining over 2%, indicating a clear risk-off tone and deterioration in market breadth,” said Ajit Mishra, SVP, Research, Religare Broking.
Market breadth was overwhelmingly negative. As many as 3,412 stocks declined on the BSE, against just 1,018 advances.
All sectoral indices ended in the red. Metals and realty led the losses, falling more than 3% each. Oil & gas, auto and healthcare stocks also faced heavy selling.
The India VIX, the market’s fear gauge, jumped 10.3% to 15.31. This reflected growing investor nervousness.
ITC, IndiGo, Power Grid, Bharat Electronics and Adani Ports were among the biggest Sensex losers.
Reliance Industries alone accounted for 164 points, or 15.7%, of the Sensex’s decline. HDFC Bank, Bharti Airtel, ITC and L&T contributed another 409 points. Together, these five stocks accounted for nearly 55% of the fall.
The prolonged market correction has also hurt investor sentiment. Shah pointed to a gap between market performance and perception. Large-cap stocks have fallen in double digits, while mid- and small-caps have seen single-digit declines. Yet, the extended period of weak returns has created the feeling of a bear market.
However Shah believes that corporate earnings remain robust, with double-digit growth. This has helped bring valuations down, making stocks relatively more attractive.
Investors will now look to the September-quarter earnings season for direction.
“Looking ahead, the market focus shifts to the Q2 earnings season, where management commentary on demand sustainability and input cost absorption will provide critical near-term direction,” said Vinod Nair, head of sesearch, Geojit Investments.