Nifty, Sensex Drastic Drop in Stock Market: 3 Crucial Factors Driving July 9 Moves

Nifty, Sensex face drastic drop in stock market movement as consolidation continues on July 9. Pharma sector and tariff tensions dominate investor sentiment. Nifty, Sensex drastic drop in stock market momentum is expected to continue on July 9, with benchmark indices likely to remain in a tight consolidation range. As the Indian equity market awaits clear global and domestic signals, sectors like pharmaceuticals are taking center stage. At 7:50 a.m., the GIFT Nifty was trading marginally lower by 10 points at 25,593, hinting at a muted start.

The previous session ended on a slightly positive note after a late-hour buying spree. This optimism was fueled by possible trade discussions between India and the U.S. However, market mood was tempered after former U.S. President Donald Trump hinted at imposing significant tariffs up to 200% on pharmaceuticals. This has shifted attention sharply toward pharma stocks on July 9.

Nifty, Sensex Drastic Drop in Stock Market Reflects Global and Domestic Uncertainty

Investor activity remained divided. Foreign Portfolio Investors (FPIs) net sold ₹26 crore in Indian equities, while Domestic Institutional Investors (DIIs) stepped in with a net buy of ₹1,367 crore, suggesting continued support from local entities.

From a technical standpoint, the daily chart of Nifty formed a strong bullish candle, signaling potential for a continuation of upward momentum. However, for that to materialize, the index must decisively breach the immediate resistance at 25,600, with a major hurdle looming near 25,800.

On the flip side, support for the index is established around 25,500 and extends down to 25,400. A more solid safety zone lies near the 25,300 level. This setup suggests that any sharp downside could trigger buying interest around these support marks, offering potential entry points for investors.

Market volatility also eased. India VIX declined by 2.91% to settle at 12.20, signaling lower fear levels among traders. In the derivatives segment, the Open Interest (OI) data shows the highest Call OI at the 25,600 strike, while the Put OI is concentrated at 25,500 and 25,400. This suggests a narrow trading zone for the day and highlights the importance of the 25,400–25,600 range.

Key Support and Resistance Levels for Nifty, Sensex on July 9

Technically, Nifty’s formation of a green candle following hammer and doji patterns implies a potential bullish reversal. This is being seen as a healthy consolidation after the recent uptrend. Any breakout above 25,600 could invite further upward momentum toward 25,750 and 25,800.

Meanwhile, global cues remain cautious. The S&P 500 ended slightly lower as investors remained nervous about further tariff threats. Trump’s statements about targeting countries like Japan, South Korea, and others with fresh duties in August have shaken confidence. U.S. markets were mixed, with the Dow down 0.37%, the S&P 500 slipping 0.07%, and the Nasdaq ending flat.

Asian markets opened subdued. Japan’s Topix rose marginally by 0.2%, while Australia’s S&P/ASX 200 dipped 0.5%. Hang Seng and S&P 500 futures remained largely unchanged, indicating a wait-and-watch sentiment among investors.

The dollar continued its rise for the third consecutive day against the yen, driven by tariff-related developments. Currency movements remain a key external trigger that could influence FIIs’ behavior in emerging markets like India.

On the domestic front, RBL Bank is in the F&O ban list for the day after crossing 95% of the market-wide position limit. Meanwhile, the rupee appreciated by 21 paise to close at 85.73 against the U.S. dollar, aided by falling global crude prices and weakness in the greenback.

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Looking ahead, Nifty, Sensex drastic drop in stock market trend may persist unless a breakout above key resistance zones occurs. Traders are expected to stay cautious, especially with pharma-related developments and global trade tensions still evolving.

Conclusion:

Markets remain trapped in a narrow band, with the pharma sector and tariff uncertainties keeping traders on edge. Until Nifty breaks out above 25,600, expect continued consolidation and careful positioning.