With just days remaining for the Union Budget presentation, the stock market has suffered a significant setback, leaving investors shaken. On the first trading day of the week, the markets saw a sharp decline. The BSE Sensex dropped by 824.29 points, closing at 75,366.17, while the NSE Nifty fell by 263.05 points, ending at 22,829.15.
Sectoral Performance and Key Stocks
Among the gainers were ICICI Bank, Britannia Industries, SBI, M&M, and HUL, while Tech Mahindra, Wipro, HCL Technologies, Power Grid Corp, and Bharti Airtel faced the biggest losses.
DeepSeek's Disruptive AI Launch Shakes Global Markets
Investor sentiment was further dampened by weak global signals. Chinese startup DeepSeek made waves by launching a free, open-source AI model that directly competes with OpenAI's ChatGPT. This move triggered a decline in US stock futures and most Asian markets, although the Chinese and Hong Kong stock markets reacted positively.
US Dollar Strengthens Amid Global Developments
The US dollar continues to strengthen, partly due to former President Donald Trump's stance on immigration and the imposition of a 25% tariff on Colombia, which has added to its strength.
Profit Booking Prevails Ahead of the Budget
While markets typically see growth before the Union Budget, investors are now opting for profit booking due to the heightened volatility expected in the lead-up to the Budget.
Disappointing Quarterly Earnings and Foreign Selling Pressure
December quarter results have been lackluster, with most companies failing to meet expectations. Additionally, Foreign Portfolio Investors (FPIs) have been actively selling Indian stocks, offloading around ₹69,000 crore worth of shares just in January.