Profit booking, tepid global cues, and muted institutional participation drag Indian markets lower despite recent optimism over ceasefire and trade deals.
New Delhi, May 13:
After Monday’s euphoric rally, the Indian stock market saw a sharp reversal on Tuesday as the Sensex plunged over 1,000 points by noon, while the Nifty 50 dropped 117.2 points to 24,807.50, amid profit booking and caution in the broader market.
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The market opened on a muted note with the Sensex starting the day at 82,249.60, down 180.30 points, and the Nifty opening at 24,864.05, down 60.65 points. Despite a mid-session recovery attempt, the indices couldn’t hold gains.
💼 Why Did the Markets Fall?
🧾 1. Profit Booking After Monday’s Surge
Market experts cited profit booking as the primary reason for Tuesday’s slide. The Nifty had rallied nearly 3.8% on Monday, making it the best single-day performance in four years. Naturally, investors chose to lock in gains.
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“Non-institutional domestic buying fueled Monday’s surge. But the lack of strong institutional participation made the rally fragile,” said Ajay Bagga, market expert.
🌏 2. Global Cues: US-China Trade Reset Underwhelms
Markets were also digesting the US-China trade truce, which temporarily halted mutual tariffs for 90 days. However, analysts described the agreement as symbolic rather than transformative, providing little strategic clarity.
📉 3. Weak Institutional Flow
Data from Foreign Portfolio Investors (FPIs) and Domestic Institutional Investors (DIIs) showed subdued activity, reinforcing the view that Monday’s rally was driven largely by retail and high-net-worth individual (HNI) buying.
📊 Sectoral Snapshot
- Gainers:
- Nifty Pharma rose 1.2%
- Nifty PSU Bank remained in the green
- Losers:
- Nifty IT dropped over 1%
- Other major sectors traded in the red
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🔻 Top Losers (Sensex)
- Infosys
- Power Grid
- Kotak Mahindra Bank
- ICICI Bank
- HCL Tech
- TCS
- Nestle
🔼 Top Gainers
- Sun Pharma
- IndusInd Bank
- Bajaj Finance
- Tata Steel
As markets continue to digest geopolitical and global trade developments, analysts recommend cautious optimism with a focus on sector-specific strength, particularly pharma and select banking stocks.
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Sensex crash, Nifty 50 today, Indian stock market dip, profit booking, US-China trade deal, FPI DII activity, market correction, sectoral performance, May 13 market update