Last Updated:
Sensex and Nifty fell sharply, extending losses for a fifth session due to US tariff concerns and persistent foreign fund outflows.
Why Is Stock Market Falling Today? Check Factors
Why Is the Stock Market Falling Today? Benchmark indices extended their losses for a fifth consecutive session on Friday, January 9, as concerns over foreign fund outflows, geopolitical tensions and caution ahead of Q3 earnings kept investors on the sidelines.
The Sensex plunged more than 600 points, or nearly 0.80%, to an intraday low of 83,547, while the Nifty 50 fell 0.80% to 25,681. The BSE Midcap and Smallcap indices declined by over 1% each.
Over the past five sessions, the Sensex has shed more than 2,200 points, or 2.6%, while the Nifty 50 is down 2.5%.
Why is the Indian stock market falling?
1) Persistent FII selling
Foreign institutional investors have been net sellers of Indian equities since July last year. In January till the 8th, FIIs sold Indian stocks worth over ₹8,000 crore in the cash segment.
Foreign capital outflows were a key reason behind the market’s modest returns in 2025. Experts warn that if the trend continues, domestic market gains could remain subdued in 2026 as well.
2) Caution ahead of US tariff ruling
The US Supreme Court is expected to deliver its verdict on Trump’s “Liberation Day” tariffs on Friday, January 9.
A ruling against Trump would be seen as a relief for markets, while a verdict in his favour could further dampen sentiment by encouraging more aggressive tariff actions.
Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said the market will closely track whether the court partially strikes down the tariffs or declares them completely illegal.
“If the Supreme Court declares Trump tariffs illegal, there would be a rally in India since India has been the worst affected by the 50% tariffs,” Vijayakumar said, adding that Thursday’s sharp correction was triggered by fears of a possible 500% tariff under the Russia Sanctioning Act approved by Trump.
3) Renewed tariff concerns
Markets have weakened sharply after Trump hinted at raising tariffs on Indian goods over New Delhi’s purchases of Russian crude. Over the past four sessions, the Sensex and Nifty have fallen 1.8% and 1.7%, respectively.
Trump has also approved a sanctions bill that could impose 500% tariffs on countries buying Russian oil. US Senator Lindsey Graham said the bill would give Trump “tremendous leverage against countries like China, India and Brazil” to stop purchasing cheap Russian oil.
“Persistent concerns over potential US tariff actions linked to India’s Russian oil imports have kept sentiment fragile, while the lack of visible progress in US–India trade discussions is reinforcing institutional caution,” said Ponmudi R, CEO of Enrich Money.
4) India–US trade deal uncertainty
Uncertainty surrounding the India–US trade agreement continues to weigh on sentiment. Despite multiple rounds of negotiations, the two countries have failed to finalise a deal, contrary to expectations that India would be among the first to conclude an agreement with the US.
Vinod Nair, Head of Research at Geojit Investments, said delays in the trade deal could prolong India’s market underperformance.
5) Rising crude oil prices
Brent crude rose 0.53% to $62.32 a barrel. Higher oil prices increase India’s import bill and inflation risks, which tend to pressure equity markets.
6) Rupee weakness
The rupee slipped 7 paise to 89.97 against the US dollar in early trade on Friday amid sustained FII outflows and higher crude prices. It opened at 88.88 at the interbank forex market before weakening further.
Forex traders said worries over possible US tariffs and weak domestic equities have led to continued foreign selling, putting pressure on the currency.
Technical outlook
Devarsh Vakil, Head of Prime Research at HDFC Securities, said the Nifty has broken key support levels.
“The Nifty breached crucial support at its 50-day exponential moving average at 25,911 and also violated the previous swing low of 25,878 on the daily chart. The next meaningful support is near 25,700, which coincides with the December 2025 swing low. On the upside, the 26,000–26,050 zone is likely to act as strong resistance in the near term,” Vakil said.
Click here to add News18 as your preferred news source on Google.
January 09, 2026, 13:04 IST
Read More