Indian equity markets extended their losing streak for the fifth consecutive session on Friday, with both benchmark indices experiencing sharp declines amid a confluence of domestic and global factors weighing on investor sentiment.

Market Performance Overview

The trading session began with gap-down openings for both major indices, reflecting negative sentiment from the market's start. Despite some intermittent buying pressure during the session, both indices ultimately succumbed to selling pressure.

Key Factors Behind Market Decline

Foreign Institutional Investor Selling

Foreign Institutional Investors continued their selling spree on Thursday, offloading equities worth ₹3,367 crores. This marked the fourth consecutive session of net selling by FIIs, who remain major players in India's financial markets and significantly influence market direction.

US Tariff Concerns and Trade Tensions

Investor attention focused on the US Supreme Court ruling regarding the legality of tariffs imposed by Trump. The potential ruling could require the US government to refund nearly $150 billion to importers if tariffs are declared illegal. Market participants are particularly concerned about Trump's hints at higher tariffs on Indian goods due to India's Russian crude purchases, including potential 500% tariffs under the Russia Sanctions Act.

Commodity and Currency Pressures

Rising crude oil prices added to market concerns, with Brent crude climbing 0.53% to $62.32 per barrel. Higher crude prices typically increase India's import costs and fuel inflationary pressures, negatively impacting equity markets.

The Indian rupee weakened significantly, falling 33 paise to 90.23 against the US dollar in Friday's trade after opening at 89.86. Forex traders attributed the currency pressure to sustained foreign fund outflows, rising crude prices, and concerns over potential US tariffs.

Technical Analysis Outlook

From a technical perspective, both indices face critical support and resistance levels:

Market Outlook

The ongoing concerns over potential US tariffs and stalled US-India trade talks continue to keep market sentiment fragile, particularly among foreign investors. The combination of geopolitical tensions, currency weakness, and commodity price pressures has created a challenging environment for Indian equities in the near term.

Indian equity markets faced significant selling pressure on Friday, extending their losing streak to a fifth consecutive session. The benchmark indices witnessed substantial declines, with both the Nifty 50 and Sensex falling 0.71% during the trading session. The Nifty closed below the psychologically important 25,700 level, while the Sensex dropped approximately 600 points, reflecting widespread bearish sentiment across the market.

Weekly Performance Impact

The persistent selling pressure resulted in a notable weekly decline for both benchmark indices. Over the five-day period, markets erased nearly 2.5% of their value, highlighting the intensity of the current correction phase. This sustained downward movement has significantly impacted investor portfolios and market sentiment.

Key Market Pressures

Three primary factors contributed to the market weakness during the session. Foreign institutional investor selling continued to weigh on market sentiment, creating sustained downward pressure on equity valuations. Additionally, nervousness ahead of a potential US Supreme Court ruling on Trump's tariff powers added to investor uncertainty.

Trade relation concerns between India and the US further compounded the negative sentiment. The combination of these factors created a challenging environment for equity markets, leading to broad-based selling across various sectors and market segments.

Broad-Based Market Impact

The selling pressure was not confined to specific sectors but spread across the entire market spectrum. This broad-based decline affected benchmarks comprehensively, indicating that the negative sentiment was widespread rather than concentrated in particular areas. The comprehensive nature of the decline suggests that investors adopted a risk-off approach across multiple asset classes and sectors within the Indian equity market.