Mon Jan 13 17:43:26 UTC 2025: ## Indian Stock Market Crashes, Losing ₹13 Lakh Crore in a Day

**Mumbai, India** – Indian stock markets experienced a significant downturn on Monday, with benchmark indices plummeting amidst widespread selling. The Sensex plunged 1,100 points, closing at 76,337.73, while the Nifty50 fell over 300 points to 23,101.80. This dramatic fall wiped out ₹13 lakh crore (approximately $157 billion USD) in investor wealth.

The sharp decline was attributed to a confluence of factors, primarily a strong US jobs report that lessened expectations for US Federal Reserve rate cuts. This, coupled with a strengthening dollar and rising global crude oil prices (Brent crude exceeding $81 per barrel), fueled inflationary concerns and negatively impacted emerging market currencies, including the Indian rupee, which hit a record low against the dollar.

Banking, financial, and IT stocks led the losses, with major players like HDFC Bank and ICICI Bank experiencing significant drops. All Nifty sectoral indices traded in the red, with Nifty Realty falling nearly 6%.

Foreign Institutional Investors (FIIs) continued their selling spree, withdrawing over $4 billion from Indian equities this month alone, adding to the $11 billion outflow from the previous quarter. While Domestic Institutional Investors (DIIs) bought ₹3,961.92 crore worth of shares on Friday, this was insufficient to offset the FII selling pressure.

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, commented that the market faces significant headwinds due to the global macroeconomic environment and continued foreign outflows. Analysts predict a bearish trend could persist in the near term, possibly extending until March, with a potential recovery around April. Emkay Global forecasts a subdued Nifty, targeting 25,000 for 2025, although it anticipates outperformance from small and mid-cap stocks.

Despite the current volatility, analysts emphasize the need for caution and recommend consulting financial advisors before making investment decisions. The outlook hinges on improvements in earnings and a reduction in FII selling pressure in the coming months.

Read More