Taking Stock: Sensex, Nifty log over 5% weekly loss, steepest decline since June 2022

The selloff was triggered by the US Federal Reserve's cautious stance on rate cuts.

India's benchmark indices Sensex and Nifty recorded their steepest weekly declines in over two years, dropping more than 5 percent each amid global market volatility that weighed heavily on investor sentiment.

On December 20, the Sensex closed near the 78,000 mark, shedding 1.5 percent from the previous session, while the Nifty fell below 23,600, also down 1.5 percent. This marked their sharpest weekly loss since June 2022.

The selloff was triggered by the US Federal Reserve's cautious stance on rate cuts. The Fed revised its forecast to just two rate cuts in 2025, down from an earlier projection of four, unsettling markets globally.

European markets also felt the impact, with the Stoxx 600 slipping 1 percent, putting it on track for its worst week in three months. Asian equities faced similar pressures, with a key regional index dropping for a sixth consecutive day, its longest losing streak since April. In the US, S&P 500 and Nasdaq 100 futures fell 0.8 percent and 1.2 percent, respectively, extending losses following Wednesday's selloff.

Market focus now turns to the upcoming US personal consumption expenditures (PCE) data for November, a key measure of inflation closely watched by the Fed.

Meanwhile, fears of a looming US government shutdown have intensified after the Republican-led House rejected a temporary funding plan supported by President-elect Donald Trump, with the shutdown deadline less than 24 hours away.

Outlook for December 23

Prashanth Tapse, Senior VP (Research), Mehta Equities

Index	Prices	Change	Change%
Sensex	84,363.37	411.18	+0.49%
Nifty 50	25,843.15	133.30	+0.52%
Nifty Bank	58,033.20	319.85	+0.55%

Nifty 50 25,843.15 133.30 (0.52%)

Mon, Oct 20, 2025

• 1D
• 5D
• 1M
• 3M
• 6M
• 1Y
• 2Y

Biggest Gainer	Prices	Change	Change%
Cipla	1,639.10	61.50	+3.90%

Biggest Loser	Prices	Change	Change%
ICICI Bank	1,390.30	-46.30	-3.22%

Best Sector	Prices	Change	Change%
Nifty PSU Bank	7857.85	219.10	+2.87%

Worst Sector	Prices	Change	Change%
Nifty Auto	27185.50	-43.10	-0.16%

Nervousness continued to grip investors and stocks across-the-board went into a tailspin as the dollar's continuing strength against the rupee has been prompting foreign investors to flee local equities and take shelter in safe haven dollar assets. Investors are also apprehensive about Trump's trade policies when he takes charge in mid January next year, as his aggressive policies could further roil global markets.

Ajit Mishra – SVP, Research, Religare Broking

Markets experienced a sharp decline on Friday, shedding nearly one and a half percent as the corrective phase persisted. After a choppy start, the Nifty index steadily weakened throughout the day, breaching the critical support of its long-term moving average, the 200 DEMA. Selling pressure was evident across sectors, with realty, IT, and auto taking the hardest hits. Broader indices were also significantly impacted, registering losses between 2.2 percent and 3 percent.

As anticipated, declines in IT and banking heavyweights are adding to the market pressure, signaling potential challenges ahead. The November low around the 23,250 zone now emerges as the next key support, while the 23,850-24,000 range serves as a resistance zone for any recovery attempts. Traders should adjust their positions accordingly, maintaining a strong focus on risk management.

Vinod Nair, Head of Research, Geojit Financial Services.

Disappointment regarding the slower-than-anticipated rate cuts by the US Fed has adversely affected global market sentiment. This bearish outlook is particularly impacting the domestic market, which is already contending with high valuations & low earnings growth. The sell-off has been widespread, with significant declines in mid- and small-cap stocks, where valuations premiumisation is at historical peak. The IT sector is notably underperforming as it was amongst the best performers in anticipation of rapid rate cuts in 2025.

Amol Athawale, VP-Technical Research, Kotak Securities

In the last week, the benchmark indices corrected sharply, with the Nifty ending 4.7 percent lower, while the Sensex was down by 4100 points. Among sectors, the Pharma index outperformed, rallying over 1.5 percent, whereas the Metal and Bank Nifty indices corrected sharply, shed over 5 percent. During the week, the market slipped below the 20-day and 50-day Simple Moving Averages (SMA), and post-breakdown, selling pressure intensified.

Technically, the weekly charts have formed a long bearish candle, and after a long time, the Nifty closed below the 200-day SMA, which is largely negative. We believe that as long as the Nifty remains below the 200-day SMA or 23800/78300, weak sentiment is likely to continue. Below this level, the market could slip to 23400-23200/77500-77000. On the other hand, if it rises above 23800/78300, the pullback formation is likely to continue up to 24000/80000. Further upside may also occur, potentially lifting the market up to 24200/80600.

For the Bank Nifty, on the lower side, 50500 or the 200-day SMA would act as a crucial support zone. If it sustains below this level, it could slip to 50300-49800. Conversely, if it breaks above 51200, it could bounce back to 51800-52200. Short-term traders should remain cautious and selective, as there is a risk of being trapped at lower levels.