Indian stock markets lost momentum after an early rally on Thursday, with the Sensex slipping nearly 300 points from the day’s peak while the Nifty dropped below the crucial 23,900 level as investors turned cautious amid rising volatility. The sharp reversal erased much of the morning optimism and pushed benchmark indices into a weaker zone.
Analysts pointed to profit booking as one of the biggest reasons behind the market retreat. After recent gains, many traders chose to lock in profits, creating selling pressure across key sectors and dragging indices lower from their intraday highs.
Growing concerns around geopolitical tensions also weighed heavily on sentiment. Uncertainty surrounding developments in the Middle East, especially ongoing concerns linked to the US-Iran situation, kept investors cautious and triggered risk-off trading. Rising global tensions have also increased worries about higher energy costs and inflationary pressure.
Foreign institutional investor selling continued to remain another major pressure point for the market. Persistent outflows from overseas investors have kept sentiment fragile, especially at higher valuations, limiting the ability of benchmarks to sustain rallies.
Market participants also blamed expiry-related volatility for the sharp swings, as monthly derivatives positions added extra pressure and intensified fluctuations during the trading session. Despite weakness in benchmark indices, broader markets including midcaps and smallcaps showed relatively better resilience.
Overall, traders remain focused on global cues, crude oil movement, foreign fund activity, and upcoming economic triggers that could decide whether markets stabilize or witness further selling pressure.
Reference is taken from here