Sensex, Nifty On Makar Sankranti 2025: Will Indian Stock Market Fall Or Rise On Tuesday, January 14?

Stock Market: Indian stock market witnessed huge selling pressure on Monday, January 13, with Sensex and Nifty 50 ending lower by more than 1.3% each. Sensex is below 76,400 levels, and Nifty 50 has breached under 23,100 mark. All sectoral indices were in red, with midcaps and small-caps performing lowest levels in 5 months. The performance comes ahead of the Budget 2025 announcement, with Q3 earnings, foreign investors flow and global trends emerging as key triggers currently. On January 14, 2025, the market is open despite the public holiday in many states due to the celebration of Makar Sankranti 2025. Will the Sensex and Nifty rise or fall on Tuesday?

Sensex Crashed:

On January 13, 2025, Sensex ended at 76,330.01, down by 1048.90 points or 1.36%. The index hit an intraday low of 76,249.72.

Axis Bank, TCS, HUL and IndusInd Bank were the only gainers. Zomato, Power Grid, Adani Ports, Tata Steel, NTPC, Tata Motors, M&M, Asian Paint, Tech Mahindra and Ultratech Cement dipped by more than 2.3% to 7%, emerging among top underperforming stocks.

After market hours, BSE Sensex Next 50 dipped by 2,998 points to 75,047.23, while BSE Bankex plunged 681 points to 54,618.86. On BSE, of all the 4,248 traded stocks, only 508 stocks advanced and a huge 3,621 stocks declined, while the rest 119 stocks were unchanged. Further, 120 stocks hit a 52-week high, but a massive 508 stocks touched their 52-week lows.

BSE-listed company's market cap was at 4,17,05,906.74.

Nifty Crashed:

The 50-scrip benchmark closed at 23,085.95, down by 345.55 points or 1.47%. The index touched its intraday low of 23,047.25 as well. Bank Nifty nosedived by 693 points to 48,041.25. India's volatility index surged by 7.3% to 16 levels on Monday.

Nifty Midcap 100 and Nifty Small-Cap 100 indexes plunged more than 4% each, which is their lowest single-day performance in five months. All sectoral indices were also in deep red, with PSU Bank, Metals, Realty, Auto, Oil & Gas, Healthcare and Media stocks being major draggers of the day.

Explaining why the market fell on Monday, Vinod Nair, Head of Research, at Geojit Financial Services said, the global markets witnessed a significant sell-off, prompting a similar response in domestic markets due to strong US payroll data suggesting fewer rate cuts in 2025. This has strengthened the dollar, driven up bond yields, and made emerging markets less attractive. Recent GDP downgrades and slowing earnings amidst higher valuations are weighing heavily on market sentiment.

Meanwhile, Satish Chandra Aluri, Lemonn Markets Desk said, what we are seeing is extreme pessimism going into the earnings and budget as investors are still not comfortable with the valuations, despite the recent fall, given the poor earnings outlook and weak global sentiment. Friday's US jobs report and subsequent spike in US yields and the Dollar had a double whammy impact on emerging markets with sharp foreign outflows and the prospect of only one rate cut from the US Fed. Globally, markets are adjusting to the prospect of even no rate cuts from the US Fed, if US economic momentum remains strong.

Will the Stock Market Fall Or Rise On Tuesday, January 14?

January 14th is special as India will be celebrating the occasion of Makar Sankranti. However, the stock market is open on Tuesday.

Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services Ltd said, "Continued foreign institutional investor (FII) selling crossed Rs. -20,000 Cr this month, contributing to the negative sentiments. Indian rupee touched a fresh low of 86.40 against the dollar during the session, pressured by stronger-than-expected US non-farm payrolls data which further dampened the sentiment, resulting in a firm dollar index. Meanwhile, oil prices hit their highest level in over three months amid expanded US sanctions disrupting Russian crude supplies, further adding to global uncertainties. India's annual retail inflation eased to 5.22% in December, down from 5.48% in the previous month. This moderation in inflation could provide some downside support to the markets. However, tomorrow's US PPI figures are expected keep investors cautious."

On technical terms, Shrikant Chouhan, Head Equity Research, Kotak Securities said, after a weak opening, the market breached the crucial support level of 23260/77000, which is largely negative. It also formed a bearish candle on daily charts and is holding a lower top formation on intraday charts, indicating further weakness from current levels.

Chouhan added, for day traders, 23260/77000 would act as a trend decider level; below this, weak sentiment is likely to continue. If it falls below this level, the market could slip to 22900-22800/76000-75700. On the flip side, if we move above 23260/77000, the pullback could extend to 23400-23450/77300-77500.

Furthermore, Arsh Mogre, Economist Institutional Equities, PL Capital - Prabhudas Lilladher said, India's CPI inflation eased to a four-month low of 5.22% in December 2024, down from 5.48% in November, largely driven by a sharp moderation in food inflation. Vegetable prices, a key contributor, declined significantly, with double-digit sequential drops in items like tomatoes, onions, and green leafy vegetables, benefiting from favorable winter seasonality. This trend was further supported by kharif produce arrivals and robust rabi sowing progress, up 1.5% YoY as of December 9, 2024. However, concerns over stickiness in food inflation remain. Edible oils, for instance, continued to face upward price pressures due to the dual impact of September's custom duty hikes and elevated international prices. The weakening rupee-down to a record low of 86.58 against the dollar-has compounded this issue. According to the RBI, a 5% depreciation in the rupee typically adds 35 basis points to headline inflation, highlighting the risks posed by currency movements.

Mogre added, this dynamic, coupled with the likelihood of U.S. President-elect Trump reintroducing trade tariffs, raises concerns about potential inflationary spillovers from global trade disruptions. While the CPI basket is less sensitive to international trade disruptions than the WPI basket due to its higher share of non-tradables, a lagged impact cannot be ruled out. Such risks, however, are expected to materialize more prominently in FY26 rather than FY25. For now, the arrival of kharif produce, healthy reservoir levels, and steady rabi sowing progress are likely to keep food inflation contained. Consequently, we maintain our FY25 CPI inflation forecast at 4.7%, while acknowledging upside risks. From a monetary policy perspective, the Reserve Bank of India faces a delicate balancing act.

Lastly, Mogre said, "With downside risks to growth becoming increasingly evident, a pivot in the monetary policy stance appears imminent. We anticipate a 25-bps rate cut in the February 2025 MPC review, as the policy focus shifts from immediate inflation risks to addressing growth challenges in the broader economic context."