Sensex, Nifty resume downtrend after a day's breather, fall up to 1.6%: Where does next support lie? Check what analysts say

Stock market today news: Sensex, Nifty see profit booking in trade.

• Sensex and Nifty fell over 1 percent after a brief recovery.
• Foreign fund outflows and banking share selling drove declines.
• Analysts say market weakness persists despite recent bounce.

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The equity benchmark indices resumed their decline on Wednesday after a day’s breather, falling up to 1.5 percent amid continued foreign fund outflows and selling in blue-chip banking shares.

The Sensex was trading 1,197.45 points or 1.53 percent, lower at 77,008.53. The broader Nifty slipped 348.15 points or 1.43 percent to 23,913.45.

Markets had closed higher in the previous session. On Tuesday, the Sensex jumped 639.82 points or 0.82 percent to settle at 78,205.98. The Nifty climbed 233.55 points or 0.97 percent to end at 24,261.60.

Out of 7 sessions in March so far, the Sensex and Nifty have declined by up to 7 per cent in 5 sessions combined.

Analysts said the recent pullback in domestic equities had been supported by a sharp correction in global crude prices. Brent crude has declined from around USD 120 a barrel to nearly USD 86, offering some relief to global risk sentiment and aiding a recovery in domestic markets.

Volatility has also eased, with the India VIX cooling from levels near 24 to below 19.

However, analysts cautioned that the broader market structure continues to indicate weakness.

Ruchit Jain of Motilal Oswal Financial Services said that despite the recent bounce, the broader market still reflects a lower top–lower bottom formation.

"Despite the recent bounce, the broader market structure continues to reflect a lower top–lower bottom formation, suggesting that the current move should be viewed as a pullback rather than a confirmed trend reversal at this stage," he said.

According to Jain, for the pullback to sustain, the Nifty needs to hold above the 24,200 level, which could open the door for a move towards 24,444 and 24,600. On the downside, support is seen around 24,000, followed by 23,800.

Prashasta Seth – CEO, Prudent Investment Managers LLP, added "Given the uncertainty in the middle east and its massive ramifications specially on crude in immediate term such short-term corrections and volatility is not unusual. Market corrections of 5–10% on specific news are historically common and often help normalise valuations after extended rallies. Valuations esp in certain segments of the markets like micro caps and small caps have become supportive but multiple uncertainties like crude oil prices, monsoon and impact of AI on Indian IT services have kept the market under pressure. However, investors should avoid overreacting to short term fluctuations. For long-term investors, the focus should remain on disciplined asset allocation and gradual investments rather than attempting to time every market move. Periods of volatility can provide opportunities to accumulate quality assets systematically while staying aligned with long-term financial goals."

Rupak De, Senior Technical Analyst at LKP Securities, noted "Bears remained at the helm and, as expected, they emerged around the 24,300 level, leading to a sharp fall during the day. On the lower end, the index slipped further and briefly pierced the 24,000 mark. The ongoing rise in crude oil prices and the choking supply of natural gas sent shockwaves through the Indian equity market. An already weak technical chart extended its weakness, as the positive gap between the 50DMA and 200DMA appears to be narrowing, heightening the risk of a death cross. A death cross occurs when the 50DMA cuts the 200DMA from above. If this happens, further rounds of selling pressure could emerge, potentially pushing the Nifty significantly lower. Supports are placed at 23,700 and 23,300, while on the higher end, resistance is placed at 24,100."

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