As of January 22, 2025, the Indian stock market continues to grapple with significant challenges, with the BSE Sensex down nearly 10,000 points or 11.5% from its all-time high in September 2024 [8ed72a4e]. Recent polling indicates that a majority of market experts believe the indices could fall another 10% before reaching a bottom, with 63% of analysts predicting this outcome [8ed72a4e]. The Nifty 50 has also experienced a correction of 2.85%, while the Sensex fell by 3.2% since the beginning of the year [8ed72a4e].
The ongoing market volatility is attributed to various factors, including the anticipated swearing-in of Donald Trump, which has raised concerns about potential changes in tariffs and deregulation that could impact the Indian economy [8ed72a4e]. Analysts like Nirav Karkera have cited India's inflation as another critical issue contributing to investor anxiety [8ed72a4e]. Furthermore, Kotak Institutional Equities has pointed to headwinds from earnings resets and geopolitical tensions that are likely to affect market performance [8ed72a4e].
On January 17, 2025, the BSE Sensex had already fallen over 750 points to an intraday low of 76,263, while the Nifty 50 dropped more than 200 points to 23,102 [6f24fafd]. This downturn was exacerbated by stronger-than-expected US jobs data, which diminished hopes for early interest rate cuts by the Federal Reserve, and rising US bond yields that reached 4.73% [6f24fafd]. The Indian rupee also hit a two-year low of ₹86.27 against the US dollar, further complicating the market landscape [6f24fafd].
Despite a brief recovery on January 14, where the BSE Sensex rose over 250 points, the underlying issues remain unresolved, and investor sentiment continues to be cautious [875ce0f3]. As major companies like Infosys and Reliance Industries prepare to release their Q3 results, analysts are closely monitoring these developments, as they could significantly influence market confidence moving forward [6af36d67].
In summary, the combination of external pressures from global economic indicators and internal challenges, such as corporate earnings and inflation, will be crucial in determining the trajectory of the Indian stock market in the near future. With expert predictions suggesting further declines, investors are advised to remain vigilant [8ed72a4e].