Sensex Crash Today: The Indian equities plummeted heavily in the third consecutive session and the BSE Sensex and Nifty 50 crashed because of global uncertainties and low domestic earnings. An increasing tension due to the threats of U.S. President Trump, a weakening rupee, and continuous outflows of foreign funds completely destroyed the trust of investors, causing an enormous loss in wealth.
Author : Akshita Jain | EQmint | Market News
Indian stocks plunged further into the red on Wednesday as a three-day battering continued with global shocks and spotty earnings draining the risk appetite. The BSE Sensex dropped over 1,000 points throughout the day, and the Nifty 50 dropped beneath the much-anticipated 25,000 threshold the first time since October 2025.
The Sensex plummeted up to 1,056 to an intraday low of 81,124, and the Nifty went down 1.2 per cent to an intraday low of 24,920. The Sensex was down 102 points or 0.22 per cent to 82,078.1,6 and the Nifty was down 17 points or 0.07 per cent to 25,215.55 at the opening bell as early gains faded.
The selloff wiped out an investment worth approximately Rs 6 lakh crore, pulling the market value of all companies listed in BSE to Rs 449.76 lakh crore.
The fall is an indication of a market struggling with several head winds simultaneously, continuing outflows of foreign funds, lopsided domestic incomes and increased world uncertainty, following the severe sell off on Tuesday that pushed yardsticks to their lowest stage in over three months.
5 key factors
The following are the most critical reasons for the market fall today:
1. Trump’s Greenland threats.
The Asian markets continued to decline in a third session due to increased tensions regarding the threats posed by U.S. President Donald Trump to purchase Greenland and the re-emerging trade war with the European Union. The rhetoric triggered trepidation of offshore selling of U.S. assets, the so-called Sell America trade, which was first floated last year when the Liberation Day tariff announcements dropped the U.S. market by more than 2 per cent. after Wall Street dropped more than 2 per cent. overnight and the U.S. currency recorded its largest decline in over a month.
The effect of that worldwide flight was to drive investors into safe havens, gold and silver soaring to records. Trump reinforced his position by claiming that there was no turning back on his ambition to possess Greenland, and he would not dismiss the idea of using force. His new tariff threats on Europe have caused fear of a new world trade war. On Thursday, the European Union will convene an emergency summit in Brussels, and investors are awaiting the speech of Trump at the World Economic Forum in Davos later in the day.
In the early trade, the widest index of Asia-Pacific shares by MSCI other than Japan decreased 0.3 percent whereas Japan’s Nikkei decreased 1.2 per cent, continuing its losing streak to five consecutive trading sessions. Futures in the U.S. recovered a bit of the ground, however, only after the S&P 500 fell by 2.06% and the Nasdaq Composite fell by 2.4% overnight.
2. Weak domestic earnings
A turbulent earnings period did not help much. The absenteeism of heavyweight firms like Reliance Industries Ltd., and ICICI Bank also hampered the mood and served to bolster the argument that high valuations may be outpacing fundamentals.
The sectoral losses were headed by a drop in the IT index by 1%. Persistent Systems dropped 3.5% even after it reported increased quarterly profit because various brokerages indicated low upside and attributed it to high valuations.
3. Rupee sinks to record low.
Indian rupee dropped to an all-time low on Wednesday, which is one more pain on the neck of equity investors already shaken by global risk aversion. The currency had fallen below its mandated low of 91.0750 per U.S. dollar recorded in mid-December and it was last trading at an approximate 91.2950, driven down by the fears related to the Greenland dispute, the continued outflow of capital and lack of a U.S.-India trade pact.
The rupee has already depreciated by approximately 1.5 per cent this month, and this follows a close to 5 per cent fall in 2025, an action that has brought in worries regarding imported inflation and foreign investor moods. The Reserve Bank of India has been playing the same script of late, and it has intervened when it felt necessary to smooth the volatility and not protect any particular level in the foreign exchange market, letting the currency relate to the wider global and domestic forces.
4. The foreign investors keep selling.
Unabated selling by the foreign institutional investors also kept on draining the market confidence, as the FIIs continued their net selling on their 11 th consecutive session. On Tuesday, Jan 20, foreign investors sold stocks of close to Rs 2,938 crore, showing their reluctance in the wake of increasing trade and geopolitical tensions around the world.
Although the domestic institutional investors offered a certain countercheck, it was not sufficient to halt the fall in benchmark indices. On the same day, DIIs turned out to be net buyers of shares to the tune of approximately 3,666 crore, which is not much help to the market as the foreign outflows continued to drive the price movement.
5. Further weakness is indicated by technical charts.
Technical indicators that were included with the gloomy atmosphere on Wednesday, as major indicators violated vital support lines. Benchmark indexes dropped drastically. Nifty fell 353 points, and Sensex dropped 1066 points. All major indices were trading down, they were sectorally, with the Realty index declining the most, down by more than 5 per cent, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.
The market has surged past the 25,500/83,000 supportive level, after a poor beginning, which caused more selling, according to Chouhan. A long bearish candle in the daily charts and a lower-top in the intraday charts suggest that the levels will continue to weaken. The intraday market structure is oversold, but it cannot be excluded that a sharp pullback rally of the lower levels can be observed.
Chouhan proposed that the market will remain weak below 25,500/82,900, and may have weakness to 25,100-25,000/81,800-81,500.
Geojit Investments Chief Market Strategist Anand James said, Favoured view anticipates the downtrend to be extended with the target being 24,715-24,580. Standard deviation analysis permits periods of upswing in an effort to reach 25,300/380, and the 200-day SMA is near. They are however, not so likely to support until the market shifts above 25,470.
The traders were recommended to sell between 25,350 and 25,400 with a tight stop loss at 25,500, and buy between 25,050 and 25,000 only when the levels become weaker with a tight stop loss at 24,900.
For more such information : EQmint
Resource Link : MoneyControl
