Bears went on the offensive on Friday, December 20 as the benchmark indices crashed around 1.5% each. Reliance Industries and HDFC Bank were the top contributors in dragging the Sensex lower.
The BSE Sensex tanked 1,176.46 points or 1.49% to close at 78,041.59. Nifty50crashed 364.20 points or 1.52% to settle at 23,587.50. Losses were deeper in the broader market as Nifty Smallcap 100 crashed 2.19%, Nifty Midcap 100 tanked 2.82%, and Nifty Microcap 250 plunged 2.27%.
Realty and IT & Telecom sectoral indices crashed more than 3% to emerge as the top sectoral losers, while Auto, IT, and PSU Bank index crashed more than 2% each. No sectoral indices settled in green, indicating that the selling was broad based.
Nifty Bank index, that tracks 12 public and private bank stocks, crashed 816.50 points or 1.58% to close at 50,759.20.
Leading the losses in the Sensex were Tech Mahindra (-3.97%), Mahindra & Mahindra (-3.60%), IndusInd Bank (-3.53%), Axis Bank (-3.28%), and Tata Motors (-2.73%). Following them were State Bank of India, TCS, Larsen & Toubro, UltraTech Cement and Reliance Industries – all of which falling between 2-2.5%.
The only gainers in the 30-share index were JSW Steel, Nestle India and Titan.
Among the Nifty50 stocks, Tech Mahindra, Axis Bank, IndusInd Bank, Mahindra & Mahindra and Trent led the losses, while Dr Reddy’s, JSW Steel, ICICI Bank, Nestle India and HDFC Life were some of the shares which advanced.
Investors lost over 10 lakh crore in today’s session. The cumulative market cap of all BSE-listed companies fell to Rs 441.09 lakh crore. It was Rs 451.14 lakh crore the previous day.
Over the past week, BSE-listed companies have lost nearly 20 lakh crore (Rs 19.73 lakh crore).
Vinod Nair, Head of Research, Geojit Financial Services, said, “Disappointment regarding the slower-than-anticipated rate cuts by the US Fed has adversely affected global market sentiment. This bearish outlook is particularly impacting the domestic market, which is already contending with high valuations & low earnings growth.”
The sell-off has been widespread, with significant declines in mid- and small-cap stocks, where valuations premiumisation is at historical peak, Nair said. “The IT sector is notably underperforming as it was amongst the best performers in anticipation of rapid rate cuts in 2025.”
Earlier today, Sameet Chavan, Head Research, Technical and Derivative at Angel One, had said, “On the weekly chart, Nifty50 has already wiped out gains from the past three weeks. A sustained move below 23,800 could trigger further downside, potentially revisiting the recent lows around 23,200.”
For now, given the prevailing momentum, Chavan suggests that the near-term outlook appears bearish. “Any interim bounce could be seen as an opportunity to reduce long positions. The bearish gap between 24000 and 24150 is likely to act as immediate resistance,” Chavan said.