Nifty Midcap 100 Drops 1.46%, Smallcap 100 Loses 1.36% Amid Broad Market Sell-off
Stock Market Update January 13, 2025 – Indian equity benchmarks BSE Sensex and Nifty50 faced significant selling pressure in early trade on Monday as global headwinds and weak investor sentiment weighed on the markets. Despite recovering from intra-day lows, the indices remained in the red, reflecting broader concerns from global and domestic developments.
Market Snapshot at 11 AM
At the time of writing, the BSE Sensex was trading lower by 367.90 points, or 0.48%, at 77,011.01, while the Nifty50 had fallen 135.70 points, or 0.58%, to 23,295.80. On the 30-stock Sensex, only IndusInd Bank (up 2.33%) and Axis Bank (up 0.35%) managed to trade in the green, while the remaining 28 constituents recorded losses. Stocks leading the decline included Zomato (-3.02%), Mahindra & Mahindra, Tata Steel, Power Grid, and Tata Motors.
On the Nifty50, only five stocks, namely IndusInd Bank (up 2.27%), Shriram Finance, HCLTech, Britannia Industries, and Maruti Suzuki India, traded higher. Losses were dominated by BPCL (-2.03%), followed by Apollo Hospital Enterprises, Mahindra & Mahindra, SBI Life, and BEL.
Sectoral Performance and Broader Market Trends
Sectoral indices painted a grim picture, with all sectors trading in negative territory. The Realty Index led the losses, shedding 2.42%, followed by the Consumer Durables, Healthcare, Metal, Auto, Oil, PSU Bank, and Pharma indices, each falling over 1%. Major sectors like IT, FMCG, and Banking also recorded significant losses, underscoring the bearish sentiment across the market.
The broader markets mirrored the benchmark indices, with the Nifty Midcap 100 down 1.46% and the Nifty Smallcap 100 slipping 1.36%. Meanwhile, the India VIX, a measure of market volatility, surged 6.78% to 15.93, reflecting heightened investor caution.
Global Headwinds and FIIs Selling Pressure
Global cues weighed heavily on Indian markets following a better-than-expected payroll report in the US on Friday. The report revealed that the US economy added 256,000 jobs in December, far exceeding the estimated 167,000. This robust data dampened hopes of rate cuts by the US Federal Reserve, pushing Treasury yields higher and pressuring equity markets globally. The spillover effects from Wall Street’s decline were evident in Asian markets, which traded lower across the board.
Foreign institutional investors (FIIs) continued their selling spree in Indian equities, net selling shares worth ₹2,254.68 crore on Friday. On the other hand, domestic institutional investors (DIIs) provided some relief by purchasing shares worth ₹3,961.92 crore. The net selling pressure from FIIs remains a key factor influencing the subdued market sentiment.
Economic Data and Key Domestic Developments
On the domestic front, consumer price index (CPI) data for December is due later today. Economists estimate that inflation may have moderated to 5.3%, primarily due to easing food prices. This data will be crucial in shaping expectations for a potential rate cut by the Reserve Bank of India (RBI) next month amid slowing economic growth.
In addition to CPI, wholesale price inflation (WPI) figures will be released on Tuesday, providing further insights into the inflationary trends in the economy. A positive inflation print could bolster hopes for monetary easing, offering a potential reprieve to the equity markets.
Separately, the Indian government is projected to save over ₹70,000 crore in capital and revenue expenditures allocated toward new schemes in the FY25 budget that are yet to be implemented. Additionally, the latest sanctions by the outgoing Biden administration targeting Russian crude oil shipments could disrupt oil imports for India, potentially impacting inflation and trade dynamics.
Stock-Specific Updates
IndusInd Bank emerged as a notable gainer, rising 2.33% on the Sensex and 2.27% on the Nifty50. Analysts attributed the rally to expectations of a doubling in its MSCI weight, which could attract inflows of $250-300 million. The bank’s strong deposit franchise and valuation metrics also supported positive sentiment around the stock.
On the other hand, Zomato and BPCL led the losses on the Sensex and Nifty50, respectively. Zomato fell 3.02%, weighed down by weak demand in the broader tech sector, while BPCL slipped 2.03%, reflecting the impact of falling crude oil prices and geopolitical risks.
Primary Market Activity
In the primary market, Standard Glass IPO and Indobell Insulation IPO debuted on the bourses, while Laxmi Dental IPO opened for subscription in the mainline segment. In the SME section, Barflex Polyfilms IPO and Sat Kartar IPO entered their second day of subscriptions.
Global Markets Overview
Asian markets were under pressure, with Hong Kong’s Hang Seng Index falling 1.6% and trading below the 19,000 mark for the first time since September 2024. Mainland China’s CSI 300 declined 0.38%, while the Shanghai Composite slipped 0.37%. South Korea’s Kospi and Kosdaq fell 0.85% and 0.61%, respectively, while Australia’s S&P/ASX 200 was down 1.24%.
US futures also pointed to a weak start, with S&P 500 futures and Nasdaq futures slipping 0.1% each. The US equity markets ended lower on Friday, with the Dow Jones, S&P 500, and Nasdaq Composite logging their second consecutive week of losses.
Outlook and Key Factors to Watch
The Indian markets are likely to remain under pressure as global macroeconomic developments and domestic economic data shape investor sentiment. The CPI and WPI inflation readings, expected over the next two days, will provide critical cues on the RBI’s policy trajectory. Meanwhile, geopolitical tensions and the impact of US sanctions on Russian crude oil shipments will continue to influence market dynamics.
In the short term, FIIs’ selling activity and global risk sentiment will remain key drivers for Indian equities. Any signs of easing in inflationary pressures or clarity on the RBI’s monetary policy stance could offer a much-needed respite to the markets.
The stock market on Monday, January 13, 2025, reflects a cautious sentiment as global and domestic factors weigh heavily on investor confidence. While indices like the Sensex and Nifty50 faced significant cuts, broader market indices also registered losses, highlighting the pervasive bearish mood. Key upcoming events, including inflation data releases and RBI consultations, are expected to provide direction to the markets in the coming days. Until then, cautious optimism and global developments will likely shape market movements.
