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The market witnessed a decline on the second day of the week. Both the major indexes were seen trading with a decline of 1.5%. On Tuesday, Nifty also broke the 23,000 level for a time. Nifty has slipped to such a low level for the first time since June 6, 2024. This decline is being seen due to negative triggers on the global and domestic front.
After Donald Trump's swearing in as US President, the threat of trade tariffs on BRICS countries, weak results of companies in the third quarter, selling by FIIs - are some of the reasons due to which this weakness is being seen in the market. Realty and consumer durables stocks are also seeing a decline.
Volatility in global markets and quarterly results of companies once again spoiled the mood of the market. On Tuesday, the volatility index India VIX was seen trading at around 5%. Let us know further what are the biggest reasons for such a big decline in the market? First reason: - Donald Trump's threat of tariffs on BRICS countries has alerted investors. Trump once again said that 100% tariff can be imposed on countries that are reducing their dependence on the US dollar for global trade. India is also an important member of BRICS. This aggressive attitude of the US President can affect India's trade strategy. Trump has also announced a 25% tariff on goods imported from Canada and Mexico from February 1. Second reason: - The results of domestic companies for the December quarter have been mixed so far. Dixon Tech has slipped 14% after the results. During the third quarter, the company's consolidated net profit and income have declined. Similarly, Zomato has slipped by 9%. The company's results have been affected due to the aggressive expansion of Blinkit. Apart from this, pressure is also visible on many other stocks. Third reason: - Global markets seem cautious about the increase in interest rates from the Central Bank of Japan. The Bank of Japan (BoJ) is scheduled to meet on Friday. If a decision is taken to increase rates in this meeting, then this will be the first time since July 2024. After the rate hike in July, its effect was seen in the global markets. Fourth reason: - There is a continuous phase of selling in the cash market by institutional foreign investors. In January 2025, FIIs have now sold more than ₹ 50,000 crore net in the cash market. Fifth reason: - The market also seems worried about the upcoming Union Budget. At present, the market is waiting till the budget to know how big an announcement the government makes regarding capex.
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