Mumbai: Indian stock markets saw a significant decline in early trade on Thursday, with the benchmark indices Sensex and Nifty both experiencing a sharp fall. As of 9:30 AM, the Sensex had dropped by 1,010 points, settling at 79,171, while the Nifty fell by 302 points to 23,895.
All 30 blue-chip stocks listed on the BSE were trading in the red, with major losers including Infosys, State Bank of India (SBI), Tata Steel, Asian Paints, JSW Steel, Bajaj Finserv, Bajaj Finance, and Mahindra & Mahindra. The sharp decline comes after the US Federal Reserve announced a 25 basis point (bps) rate cut, lowering its benchmark interest rate to 4.25-4.50%.
According to VK Vijayakumar, chief investment strategist at Geojit Financial Services, the market correction was triggered by the Fed’s guidance, which indicated fewer rate cuts in 2025 than the market had anticipated. While the 25 bps rate cut was in line with expectations, the Fed’s projection of just two additional rate cuts next year, instead of the expected three or four, caused concerns among investors, leading to a sell-off in global markets.
The Fed’s caution impacted Wall Street, where all three major indices closed sharply lower. The Dow Jones Industrial Average slid 2.6% (over 1,100 points), while the S&P 500 dropped 3.0%, and the Nasdaq Composite plunged 3.6%. This weakness in global markets further exacerbated the downturn in Asian markets, including India.
Yesterday, the Sensex closed at 80,182.20 points, down by 502.25 points or 0.62%, while the Nifty ended at 24,198.85 points, declining by 137.15 points or 0.56%. The market breadth was negative, with 2,563 stocks declining compared to 1,442 advancing, and 94 stocks remaining unchanged on the BSE. The BSE small-cap index fell by 0.76%, and the mid-cap index was down by 0.61%. Sectoral indices such as utilities, power, capital goods, and metals also witnessed significant losses.
This market turbulence reflects investor concerns over the Federal Reserve’s cautious approach to future rate cuts, influencing both global and domestic equities.
