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The Indian stock market selloff extended to the third straight session on Friday, 24 April, with the benchmarks — the Sensex and the Nifty 50 — crashing by over 1% each.

The 30-share pack tumbled 1,000 points, or 1.29%, to end at 76,664, while the Nifty 50 plunged by 275 points, or 1.14%, to close at 23,898. The Nifty Midcap 100 index fell 0.96%, while the Smallcap 100 index dropped 0.87%.

Infosys, TCS, Tech Mahindra, and HCL Tech ended as the top losers in the Nifty 50 index, falling 4-7%, while Coal India, Trent, and Hindalco ended as the top gainers in the index, rising up to 1%. As many as 38 stocks ended lower in the Nifty 50 index.

Among the sectoral indices, Nifty IT crashed 5.29%, while Media and Pharma indices fell almost 2% each.

Nifty Bank fell 0.38%, and the Financial Services index ended with a loss of 0.40%.

Investors lost more than ₹4 lakh crore as the overall market capitalisation (m-cap) of BSE-listed firms dropped to ₹462 lakh crore on Friday from ₹466 lakh crore in the previous session.

In just three consecutive sessions, the Sensex has plunged 2,609 points, or 3.3%, while the NSE barometer Nifty 50 has crashed 2.8%. Investors have become poorer by ₹7 lakh crore in three days, as the cumulative m-cap of BSE-listed firms stood at ₹469 lakh crore on 21 April.

Both indices snapped their two-week winning run, falling 2% for the week.

Let's take a look at five key factors driving the strong selloff in the Indian stock market:

The market is reeling under selling pressure due to the absence of clear signs that a peace deal between Washington and Tehran could be finalised soon.

Despite a ceasefire, both countries have not shed their aggression against each other. According to media reports, US President Donald Trump said on Thursday that he has ordered the military to “shoot and kill” small Iranian boats deploying mines in the Strait of Hormuz.

On the other hand, Iranian President Masoud Pezeshkian on Thursday said all Iranians are standing together against any external aggression to make the aggressor regret his actions.

“The market has been continuously responding to bad news and hopes emanating from a potential deal on the West Asia conflict. A mid to long-term market direction will emerge only from clarity on the conflict resolution, particularly on the opening of the Hormuz Strait. Till then, crude price will continue to fluctuate, impacting the market in the process,” said VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

Crude oil prices have been on a strong uptrend this week, rising almost 18%, as the second round of talks between the US and Iran did not take place, with neither side arriving in Pakistan. Further, the possibility of peace deals also remains shrouded by uncertainties.

The Strait of Hormuz, a key waterway through which nearly 20% of global petroleum liquids consumption flows daily, remains largely closed.

Higher crude oil prices are not just an immediate headwind for the market. Experts say investors are worried about the second-order impact of oil price volatility, which may materialise as a hit to Q1FY27 earnings.

The Indian rupee has fallen below the 94-per-dollar mark once again, weighing on market sentiment.

As per a PTI report, the Indian currency fell 24 paise to close at 94.25 against the US dollar on Friday, extending its downward streak to a fifth consecutive day.

After buying Indian equities for a few days this month, foreign institutional investors (FIIs) have resumed aggressive selling.

Over the last four sessions, FIIs have sold Indian stocks worth over ₹8,300 crore in the cash segment.

"FPIs have again turned sellers this week after buying for three days last week. This, along with the spike in crude oil prices, has again dragged the rupee below 94. If this trend of FPI selling continues, large caps will continue to be weak," said Vijayakumar.

The Nifty has breached its key support at 24,000. Even though the market appears oversold, technical experts see the possibility of further downside.

Hariprasad K, a SEBI-registered Research Analyst and Founder of Livelong Wealth, highlighted that the breakdown below 24,000 is technically significant and reflects weakening market structure at a time when macro headwinds are intensifying.

"The combination of earnings disappointment, rising crude prices, geopolitical uncertainty, and sustained foreign outflows suggests that near-term recovery may remain challenging," said Hariprasad.

According to Sudeep Shah, the head of technical and derivatives research at SBI Securities, the immediate support for Nifty is placed in the 23,600-23,550 zone.

“Any sustainable move below this zone could result in Nifty extending its weakness towards 23,350, followed by 23,150 in the short term. On the upside, the zone of 24,200–24,250 is likely to act as an immediate resistance,” said Shah.

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stories by Nishant Kumar

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.

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