Indian equity markets have extended their decline from recent record highs, with the Nifty falling below the crucial 26,000 mark amid profit-booking activities and heightened global uncertainty. Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, described the current market movement as an overdue correction following the index's climb to all-time highs around 26,300.

Market Triggers and Correction Dynamics

Bathini explained that after scaling record highs, markets were clearly awaiting a trigger to initiate a correction phase. The selling pressure has been particularly pronounced in large-cap stocks, with major names like Reliance experiencing corrections of nearly 5.00%. According to the market expert, the ongoing correction is characterized more by its time-wise nature rather than points-wise decline, a pattern that has been visible over recent months.

Tariff Concerns Impact Sentiment

Market sentiment deteriorated significantly following reports of proposed US tariffs of up to 500% on certain imports. This development caught investors off guard, particularly amid expectations of progress on bilateral trade negotiations. Bathini noted that such tariff levels are unprecedented and have created a clear negative impact on market sentiment for the short to medium term.

The uncertainty surrounding trade policies triggered aggressive foreign selling, with Foreign Portfolio Investors (FPIs) offloading equities worth ₹3,300 crores in a single trading session, adding substantial pressure on benchmark indices.

Sectoral Performance and Technical Outlook

The selling pressure has been broad-based across sectors, though certain segments have experienced more significant stress. Oil & gas, energy, power, and infrastructure stocks have faced maximum pressure during the week. Export-oriented sectors, including information technology, are also under stress due to global trade concerns.

From a technical perspective, Bathini highlighted 25,500 as an important near-term support level for the Nifty, citing significant put open interest at this strike price that could act as a support zone.

Investment Strategy Recommendations

Despite the current volatility, Bathini advised investors to maintain focus on India's domestic fundamentals. He emphasized that the country's macroeconomic indicators remain strong, with healthy GDP growth, interest rates on a downward cycle, and expectations of improving earnings.

The expert provided specific investment guidance for navigating the current market environment:

Long-term Perspective

Bathini emphasized that while global risks may continue to create near-term market volatility, corrections should be viewed as opportunities rather than exit signals. He noted that periods of fear and uncertainty often create optimal long-term entry points for investors. The expert stressed the importance of being highly selective in mid and small-cap investments, with particular emphasis on valuations, order books, and cash flows.

Infrastructure stocks could potentially gain traction ahead of the Union Budget scheduled for February, while defence sector remains attractive given ongoing global geopolitical tensions. The overall recommendation centers on maintaining a disciplined approach to stock selection while capitalizing on the correction for long-term wealth creation.

Indian equity markets extended their losing streak for the sixth consecutive session, with major indices posting significant declines as bearish sentiment dominated trading floors. The sustained selling pressure has resulted in substantial erosion of market value over the recent trading period.

Market Performance Overview

Both benchmark indices registered notable declines during the trading session. The performance metrics highlight the extent of the current market correction:

Extended Decline Pattern

The current session marked the sixth consecutive day of losses for Indian markets, representing a sustained period of bearish momentum. This extended decline has resulted in significant value erosion, with markets losing nearly 3% over the six-session period. The consistent selling pressure indicates persistent negative sentiment among market participants.

Market Sentiment Analysis

Multiple headwinds have contributed to the deteriorating market sentiment, creating a challenging environment for equity investors. The sustained nature of the decline suggests that various adverse factors are weighing on market performance simultaneously. Investor confidence has been impacted by these converging negative influences, leading to the prolonged selling pressure across market segments.

Trading Session Highlights

The current trading session witnessed broad-based weakness across major indices, with both the Nifty 50 and Sensex declining by approximately 0.80%. The Sensex registered a decline of over 600 points, while the Nifty 50 traded around the 25,475 level. This performance continues the pattern of consistent losses that has characterized recent market activity.

The cumulative impact of the six-session decline has resulted in nearly 3% erosion in market value, highlighting the severity of the current correction phase. Market participants continue to grapple with multiple challenging factors that are influencing trading decisions and overall market direction.