Indian Stock Market on 13.01.25

The Indian stock market is stuck in a pretty rough patch, with no signs of a break in the relentless selling. On January 13, the Sensex kicked off at 76,629.90, and the Nifty 50 started lower at 23,195.40, but both were hit hard from the get-go. The Sensex shed over 1,100 points, while the Nifty dropped a hefty 384 points. The bleeding didn’t stop there—by the close, the Sensex was down 1.36%, and the Nifty dropped 1.47%. That’s a big hit for anyone holding shares, but even more concerning is the broader picture. The pain wasn’t just in the blue-chip stocks. Smaller stocks got hammered the hardest, with the BSE Midcap and Smallcap indices both diving 4%. The total market cap of all BSE-listed companies shrank by a massive ₹13 lakh crore in just one day, pushing investors’ losses to nearly ₹25 lakh crore over the last four days. Sector-wise, it was a sea of red. Realty stocks took the biggest hit, with Nifty Realty crashing 6.5%, while other sectors like Media, Consumer Durables, and Metal also saw sharp declines. Even the usually sturdy banking sector wasn’t spared, with the Nifty Bank index falling over 1%.

Indian markets are feeling the heat. Foreign portfolio investors (FPIs) are fleeing in droves, pulling out ₹22,259 crore from Indian stocks this month alone. This relentless selloff has shaved nearly 2% off the Nifty 50 and Sensex, with mid and small caps bearing the brunt of the damage, losing as much as 8%. The selling pressure is compounded by the rupee’s fall, which hit a new low of ₹86.42 against the dollar, making the currency’s woes all the more evident.

A stronger US dollar is leading the charge. With the dollar index rising more than 10% in the past three months, and holding steady above 109, emerging markets are becoming less attractive to global investors. The dollar’s strength is buoyed by solid US economic data—think 256,000 new jobs in December and a 4.1% unemployment rate—suggesting that the Federal Reserve isn’t in any rush to cut rates, with some analysts even speculating hikes may still be on the table.

In India, things aren’t much better. Rising crude oil prices, modest corporate earnings expectations, and an economy struggling to find its footing are all dragging the markets down. And it’s not just India—emerging markets globally, from Brazil to Indonesia to Taiwan, are seeing similar outflows. The only outlier seems to be South Korea, which has been attracting foreign money this month.

Gold saw a slight bump in price on Sunday. The price of 24-carat gold in India edged higher to ₹7982.3 per gram, reflecting a ₹170 gain, while 22-carat gold ticked up to ₹7317.3 per gram, showing a ₹140 jump. In a market where gold’s movements are often tied to broader economic forces, today’s rise feels more like a modest breath than a leap. But in the world of precious metals, even small changes can set the tone for the week ahead.

Meanwhile, the oil market is buzzing. Crude prices shot up about 2% on January 13, reaching a four-month high. Brent futures surged $1.40 to $81.16 per barrel, while US WTI crude gained $2.15, reaching $78.72. The reason behind the surge? Tightening global supply, especially with expectations that US sanctions on Russian oil will push heavy buyers like India and China to scramble for alternative suppliers. This upward push isn’t just a flash in the pan either. Both Brent and WTI are now hovering in overbought territory, continuing a steady climb that’s seen both benchmarks rise about 7% over the past few days. For now, the price trend seems to favor the bulls, but it’s anyone’s guess how long that momentum can last.

So, what’s next? With no immediate catalysts for a market rebound, the outlook remains uncertain. Investors are likely to feel the sting of volatility for a while longer. A recovery seems distant, and with global risks piling up, from the ongoing Ukraine conflict to potential shifts in US trade policies, it’s clear – turbulence ahead is all but guaranteed.