Indian equity markets witnessed heavy selling pressure on Monday morning, January 19, with benchmark indices Sensex and Nifty extending losses amid weak global cues, rising geopolitical concerns, and disappointing domestic corporate earnings.
At around 10:14 am, the Sensex was down 561.7 points, or 0.67 percent, trading at 83,008.65. The Nifty declined 166.6 points, or 0.65 percent, to 25,527.75. Market breadth remained weak, with declines outpacing advances significantly. Key laggards on the Nifty included Wipro, Tata Motors Passenger Vehicles, ICICI Bank, and Max Healthcare.
Here are the five major factors driving the sharp market decline:
1. Weak Global Cues
Global markets turned volatile after fresh comments from US President Donald Trump reignited concerns over US–Europe trade relations. Trump warned of imposing tariffs on eight European countries if the US is not permitted to purchase Greenland, escalating geopolitical and trade-related uncertainty across global markets.
2. Speculation Around US Federal Reserve Leadership
Market sentiment was further dented after Trump ruled out Kevin Hassett as a potential candidate for the next US Federal Reserve Chair, suggesting he would remain in his current role. This dampened expectations of aggressive interest rate cuts in 2026, weighing on global risk appetite.
3. Spike in India VIX
The India VIX, which measures market volatility, rose over 5 percent to 11.98, indicating heightened investor caution and rising uncertainty in the near term.
4. Persistent FII Selling
Foreign Institutional Investors (FIIs) continued their selling streak for the ninth consecutive session. On Friday alone, FIIs sold equities worth ₹4,346.13 crore. Market experts noted that total FII outflows for January so far have reached ₹22,529 crore, reflecting sustained foreign investor risk aversion toward Indian equities in early 2026.
5. Weak Q3 Corporate Earnings
Muted December quarter (Q3) earnings added further pressure on the markets. The IT index slipped nearly 1 percent, dragged by a sharp 7.2 percent fall in Wipro shares after the company projected weaker-than-expected revenue growth for the March quarter. Banking stocks also came under pressure, with ICICI Bank shares falling around 3 percent post-results, amid concerns over higher-than-expected provisions for bad loans.
Overall, a combination of global uncertainties, sustained foreign fund outflows, rising volatility, and subdued earnings momentum has triggered a broad-based sell-off in Indian equities.
