Indian Stock Market Plunges 2.50% Amid Global Weakness

Market Performance

The Indian stock market experienced a sharp decline on Monday, with the Nifty 50 and BSE Sensex crashing around 2.50%. The Bank Nifty index tanked 1,989 points or 3.72% and closed at 51,437. Sectoral participation was broadly negative, reflecting widespread weakness across the market.

Sectoral Performance

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All major sectors ended in the red, with realty, metals, and banking among the key laggards. The selling pressure was more intense in the broader markets, where both midcap and smallcap indices declined sharply by nearly 4%, indicating strong risk aversion among participants.

Global Sentiment

The positive momentum in the Indian stock market appears largely driven by a sudden shift in global sentiment following signs of potential de-escalation in the ongoing US-Iran conflict. After Donald Trump indicated that the United States had engaged in discussions with Iran and announced a temporary halt to strikes targeting Iranian energy infrastructure, global markets reacted positively.

Asian Markets

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Asian markets have opened on a strong footing, supported by a pullback in crude oil prices. The cooling in oil has eased immediate inflation concerns and improved risk appetite across global equities.

Commodity Prices

Following the recovery in WTI crude oil and the US dollar, gold and silver opened with downside pressure in early morning trading on Tuesday. The COMEX gold rate today opened with a downside gap and touched an intraday low of $4,362.61/oz, losing over one percent against its previous day's close.

India VIX

Volatility remains a key variable to watch. India VIX, which surged to 26.7 in the previous session, is expected to moderate if the current risk-on sentiment sustains.

FII-DII Data

Foreign Institutional Investor (FII) flows remain a critical variable to watch. Persistent selling has been a key overhang on the market, and any moderation or reversal in FII outflows could act as a strong catalyst for sustained upside.

Technical Analysis

The Nifty 50 index is showing little respect for support levels despite being in an oversold zone. The next major support to watch lies in the 21,900–22,000 zone, which coincides with the 200 WEMA, followed by 21,700 (the April 2025 low). The Bank Nifty index is expected to open on a positive note, supported by improving sentiment and the likelihood of a relief bounce after recent declines.

Trading Range

The immediate trading range for the Bank Nifty today is likely between 53,000 and 55,000.