Share Market News / Chaos in the stock market on the last day of the year, Nifty fell below 23,600

Share Market News: On Tuesday, the last trading day of 2024, the Indian stock market started with a big decline. The BSE Sensex fell 404.34 points to 77,843.80, while the NSE Nifty is trading 89.60 points lower at 23,554.80. This decline has been recorded for the second consecutive day, when despite a strong start on Monday, the sell-off finally brought down the market.

As soon as the market opened this morning, all major sectors like IT, pharma, and auto saw a decline. The question is, what are the main reasons for this decline? Let's understand in detail.

Main reasons for decline

1. Impact of decline in US markets

On Monday, Dow Jones and Nasdaq registered a big decline in the US markets. Its direct impact was also seen on the Indian market. The uncertainty of US markets and weak economic indicators are affecting the sentiment of global investors.

2. Selling by foreign investors

Foreign institutional investors (FIIs) are continuously withdrawing money from the Indian market. This is increasing the pressure on the market. Due to the continuous selling by foreign investors, the Indian market is slipping below its record high.

3. Strength of dollar and weakness of rupee

The Indian rupee has reached a historic low against the dollar, at Rs 85 per dollar. The weak rupee is driving foreign investors away from the Indian market, as they suffer losses while converting their profits into dollars. Its effect is visible in the market.

4. Weak financial results of companies

The financial results of the first and second quarters of Indian companies were weaker than expected. The third quarter results are also not expected to be much better. Weak financial performance is negatively affecting investor sentiment.

5. Macroeconomic obstacles

The major problems of India's economy have also caused the decline in the market. The trade deficit reached a record high in November 2024. Also, the GDP growth rate of the second quarter was the lowest in two years. This decline in economic growth rate is increasing the concerns of investors.

Future prospects

This decline in the stock market is making investors cautious. The impact of foreign investors' selling, weak rupee, and uncertainty in global markets may continue for the next few weeks. However, the Indian market may gradually gain stability due to its strong fundamentals and long-term growth prospects.

Advice for investors:

In the current circumstances, investors are advised to maintain patience and invest in high-quality stocks with a long-term perspective. Also, it is important to keep an eye on global and domestic economic indicators.

The current decline in the Indian stock market can be seen as an opportunity, provided investors need to take steps wisely.