Indian equity markets extended their losing streak for the fifth consecutive session on Friday, January 9, 2025, as both the Sensex and Nifty 50 indices closed in negative territory. The sustained decline has resulted in a significant erosion of investor wealth, highlighting the challenging market environment.

Market Performance Overview

The benchmark indices faced continued selling pressure throughout the trading session, with market participants remaining cautious amid multiple headwinds. The fifth straight session of decline underscores the prevailing negative sentiment in the Indian equity markets.

Key Market Pressures

Several factors contributed to the sustained market decline, creating a confluence of negative sentiment drivers. The primary concerns weighing on investor minds include renewed worries about potential US tariffs, which could impact global trade dynamics and Indian exports.

Additionally, market participants are exercising caution ahead of the upcoming Q2 results season, with investors preferring to stay on the sidelines until corporate earnings provide clearer direction on company performances.

Foreign Investment Outflows

Persistent foreign institutional investor outflows have continued to pressure market sentiment. The relentless selling by foreign investors has been a significant factor contributing to the sustained decline across benchmark indices, adding to the overall negative market dynamics.

Market Outlook

The combination of international trade concerns, domestic result season anticipation, and foreign capital outflows has created a challenging environment for Indian equities. The ₹13.00 lakh crore wealth erosion reflects the magnitude of the current market correction and investor concerns about near-term market direction.

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 Sensex and Nifty 50 falling by 0.71% each during the trading session.

Market Performance Overview

The day's trading session saw the Sensex dropping approximately 600 points, while the Nifty 50 closed below the psychologically important 25,700 level. This decline contributed to a challenging week for Indian markets, with both indices erasing nearly 2.5% of their value over the five-day period.

Key Market Pressures

Three primary factors contributed to the sustained selling pressure across Indian markets. Investor nervousness intensified ahead of a potential US Supreme Court ruling regarding Donald Trump's tariff powers, creating uncertainty about future trade policies and their impact on global markets.

Foreign institutional investors continued their selling spree, adding to the downward pressure on equity prices. This persistent outflow of foreign capital has been a recurring theme affecting market sentiment and liquidity conditions.

Trade Relations Uncertainty

Renewed concerns over India-US trade relations emerged as another significant factor weighing on market sentiment. The uncertainty surrounding bilateral trade policies and potential changes in trade dynamics contributed to the cautious approach adopted by investors.

The combination of these three headwinds created a challenging environment for market participants, resulting in broad-based declines across various sectors and market segments. The sustained nature of the selling pressure, spanning five consecutive sessions, highlighted the depth of investor concerns regarding both domestic and international factors affecting the Indian equity markets.