The markets continue to be under significant selling pressure with headline and sectoral indices trading deep in the red for the sixth consecutive session on Wednesday, February 12. Furthermore, this continuous downward trend has led to a massive Rs 26 lakh crore being wipeout in BSE’s market capitalisation, triggering concerns among investors.
Sectoral indices hit hard
The market downturn has spared no sector, with major indices trading deep in the red. Banking, auto, metal, pharma, and realty stocks saw heavy losses. In the broader market, the Nifty Smallcap 50 and Nifty Midcap 100 slumped over 2%, further adding to investor woes. The continuous selling pressure has significantly dented investor wealth, wiping out nearly Rs 7 lakh crore in just six sessions.
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Let’s take a look at the 4 key reasons why the markets are falling for the sixth consecutive session:
1. US tariff hike
One of the major triggers behind the market sell-off is the US government’s decision to raise tariffs on steel and aluminum imports to 25% from 10%. The move, announced by the US President Donald Trump on Monday (February 10), also put an end to country specific exemptions. The next on the agenda is the reciprocal tax. All eyes are now on PM Modi meeting US President Donald Trump today.
2. Rising bond yields and a stronger dollar weigh on markets
The surge in US bond yields and a stronger dollar are also adding pressure on Indian markets. The US 10 year Treasury yield has climbed to 4.55%, while the 2-year yield stands at 4.3%, making U.S. assets more attractive to investors. At the same time, the dollar index has risen to 108.36, making it more expensive for foreign investors to hold assets in emerging markets like India.
ALSO READBSE SmallCap: Another day, Another 1,500 points down. Biggest losers include… 3. FII selling continues
The relentless selling by the FIIs continue. There is no slowing and in fact foreign investors sold Rs 4,000 crore worth equities yesterday. This brings the total FII outflow for February to over Rs 16,000 crore. This is after the humongous Rs 87,000 crore sold in January,
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