Indian benchmark indices continued its weakness and opened lower for another week, taking the weakness for straight ninth the trading session. The weakness in the market erased another Rs 5 lakh crore from investors pocket and the total market capitalization of the Indian stock market slipped below Rs 400 lakh crore market.
The total marketcap of all BSE listed companies dropped to Rs 395.79 lakh crore on Monday, down Rs 5.20 lakh crore from its previous close at Rs 400.99 lakh crore as per the Friday's close.
Post the pre-opening session, BSE's barometer Sensex was seen at 75,312.32, down 626 points, or 0.81 per cent in the early trade. NSE's Nifty50 Index shed 199.15 points, or 0.87 per cent to open at 22,730.10 on Monday. Broader markets continued to remain in pain as BSE midcap and smallcap indices opened down 2 per cent each. India VIX surged more than 7 per cent to 16.09-level. However, the markets scripted a partial recovery with broader markets turning flat.
The basic reason for the underperformance of the Indian market is the sharp slowdown in corporate earnings this year. Q3 results indicate only 7 per cent earnings growth, said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services. The fact is that a modest single digit earnings growth doesn’t deserve high valuations. This is the basic reason behind the relentless FII selling which has impacted the market. Appreciating dollars aggravated the problem, he said.
"Only indications of an earnings recovery and declining dollar can reverse the weakening market trend. This may happen soon. India’s macros are strong and a growth and earnings recovery are on the cards. Inflation in the US is likely to rise, thanks to the Trump tariffs, and the Fed is likely to respond hawkishly to that pulling the US markets and dollar down," Vijaykumar added.
Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 4,294.69 crore on Monday, taking the overall exodus to Rs 21,272 crore in February 2025 so far and nearing Rs 1 lakh crore mark in on a year-to-date- basis. On the other hand, domestic institutional investors (DIIs) turned net buyers of Indian equities to the tune of Rs 4,363.87 crore.
Prashanth Tapse, Senior VP (Research), Mehta Equities said that positives for the markets include Russia-Ukraine peace prospects, falling oil prices, a weaker US Dollar, and RBI’s rate cuts. However, FIIs have been net sellers in 2025, raising concerns. "Nifty and Bank Nifty are buy-on-dips opportunities," he said.
On the contrary, Asia share markets crept higher on Monday as Hong Kong's tech sector stole the limelight, while upbeat Japanese economic growth contrasted with a weak U.S. retail sales report to lift the yen on the dollar. US stocks will observe a holiday on Monday.
The Indian equity markets have witnessed a devastating trading week, completely overshadowing the positive momentum built over the past two weeks. This week was marked by an unsettling trend of eight straight sessions of sell-offs, creating a climate of concern among investors, said Sameet Chavan, Head Research, Technical and Derivative - Angel One.
"The current weekly setup in the market raises considerable concerns regarding uncertainty among participants. As we observe the price action testing both the swing low and the lower boundary of the 'Falling Wedge' pattern, it indicates a bearish sentiment in the market," he said.