Sensex Crashes 600 Points: Nifty Plunges Amid Heavy Selling in Metal & IT Stocks

Sensex Crashes 600 Points: Nifty Plunges Amid Heavy Selling in Metal & IT Stocks

In a sharp reversal of fortunes, India's benchmark equity indices opened deep in the red on Friday, mirroring weak global cues and witnessing intense selling pressure in key sectors. The sudden downturn has jolted investors after a sustained rally, raising questions about near-term market stability.

The Sensex dropped 619 points, or 0.75%, to plunge to 81,947.31 in early trade. The broader Nifty 50 followed suit, witnessing a steep fall of 171 points to hit 24,247.55. Analysts point to pronounced weakness in specific heavyweight sectors driving the decline.

Sectoral Turmoil: Metal & IT Stocks Bear the Brunt

The sell-off was notably severe in metal and information technology (IT) stocks, pulling the key indices lower. The Nifty Metal and Nifty IT indices were among the top losers, reflecting broader concerns over global demand and sectoral valuations. Banking stocks also showed pressure, with the Nifty Bank index slipping below the 60,000 mark, down over 200 points.

"While the fall seems sharp, it's largely a sector-specific correction and a technical pullback after a strong run," commented a market analyst. "For the Nifty, 25,450 becomes a crucial immediate support level to watch. If held, there is still potential for the index to climb towards the 25,600 zone."

Corporate News Driving Individual Stocks

A mix of quarterly results and corporate announcements created stock-specific action. Stocks like ITC, Vedanta, and Voltas saw movement following their earnings reports released post-market on Thursday.

Meanwhile, all eyes are on companies like Bajaj Auto and Bank of Baroda, which are slated to announce their quarterly results later today. Their performance could influence sectoral sentiment.

In a major development, South Indian Bank shares crashed nearly 18% after the bank's Managing Director and CEO, P R Seshadri, informed the board of his decision not to seek reappointment after his current term ends in September 2026. The announcement, citing a desire to focus on personal interests, led to the stock's worst single-day fall on record.

Global Markets & Institutional Activity

Mixed trends in global markets contributed to the cautious mood. While Japanese and South Korean indices traded marginally higher, Hong Kong's Hang Seng and China's Shanghai Composite were down sharply. In the US, the Nasdaq closed lower on the previous day.

On the institutional front, Foreign Institutional Investors (FIIs) continued their selling streak, offloading shares worth ₹393 crore on January 29. In contrast, Domestic Institutional Investors (DIIs) provided strong support, purchasing equities worth ₹2,638 crore, a trend that has helped cushion the market in recent months.

Outlook

Today's sharp correction serves as a reminder of the market's inherent volatility, especially at elevated levels. With key earnings still unfolding and global uncertainties persisting, the session underscores the importance of sector selection and risk management for investors navigating the current landscape. The market's ability to hold key support levels will be critical in determining whether this is a brief pause or the start of a deeper consolidation phase.

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