When markets closed on Friday in India, it gave traders some respite for the weekend as Dalal Street plummeted for the fifth consecutive day. In five days of trading, Rs 20 lakh crore was wiped from the market, led by rampant offloading by foreign institutional investors in favour of China and Japan. Interest rate hikes by the US Federal Reserve didn’t help matters, especially during the cusp of the Trump–Harris battle for the POTUS title.
The market’s losing streak for the fourth week running makes it the worst since August 2023. When markets closed for the week, foreign investors sold a little over USD 10 billion in stock in October alone. Conversely, China saw an inflow of more than USD 19 billion since the last week of September.
Indian markets got another hit when the only profitable airline in the country posted a quarterly loss. This is the first time Indigo posted a loss—much higher than expected—for the first quarter in the past two years, hit by spiking maintenance costs and skyrocketing fuel costs—despite a decline in global crude prices.
In the past few weeks, India saw poor results during the market peak, incessant foreign selling triggered by long-term yield rates in the US, gold trading higher, crypto back in demand, and the dollar strengthening. All of this points to a worrying trend if inflation catches up to Indian markets. Nifty and Sensex have so far been insulated from the trend of bear runs across the world. But will it finally catch up with India?
ALSO READ | Disappointing earnings by HUL drags FMCG stocks sharply lower
Earlier on Thursday, disappointing earnings by FMCG market leader Hindustan Unilever (HUL) triggered a sharp sell-off in the segment. HUL, Nestle India, and Tata Consumer Products all expressed concerns about dwindling consumer spending in urban areas.
On Friday, US markets rallied, with Nasdaq hitting a fresh intraday record on highcaps. In the coming weeks, Wall Street will see some of its biggest names reporting quarterly results. As the market is set to open back on Monday, Indian traders face a challenging festival season, with Diwali approaching in the coming days.