India’s stock market is going through an unusually long period of weakness. The Sensex and Nifty ended lower on October 1, marking their eighth straight weekly decline. According to the source report, this is the longest such losing streak for the two benchmark indices in the past 25 years.
The latest session was again dominated by selling pressure, with foreign investors, rising crude oil prices and higher US bond yields keeping investors cautious.
Sensex, Nifty End Lower
The Sensex dropped around 570 points, or 0.8%, to close at 71,909 on October 1.
The Nifty also remained under pressure, falling about 198 points, or 0.9%, to finish at 22,421.
Selling was broad-based across the market. Most Nifty sectoral indices ended in the red, with the IT index being the main exception.
The weakness was particularly visible in the automobile sector.
Auto Stocks Take a Heavy Hit
The Nifty Auto index fell nearly 3% during the session.
Bajaj Auto was among the major drags, with its shares falling around 6%. Mahindra & Mahindra also declined, ending the day about 2.4% lower.
The sharp move in auto stocks added to the pressure on the broader market.
Why Are Foreign Investors Selling?
Foreign institutional investors, or FIIs, have remained an important factor behind the recent market weakness.
The source report says FIIs continued selling on September 30 for the fifth consecutive trading session. Over the previous two sessions, their combined selling was reported at around ₹20,128 crore.
Interestingly, foreign investors have not completely stepped away from Indian markets. While they have been selling in the secondary market, they have continued to put money into the primary market.
For investors, the continued FII selling remains an important trend to watch because large foreign flows can have a significant impact on market sentiment.
Rising US Bond Yields Add Another Concern
Another factor putting pressure on global markets is the rise in US Treasury yields.
According to the report, the yield on the 10-year US Treasury bond reached 5.33%, its highest level since 2007. The 30-year Treasury yield also moved to levels not seen since 2002.
Higher US bond yields can make dollar-denominated assets more attractive to global investors. At the same time, expensive borrowing conditions can create concerns about economic growth and corporate financing.
This has implications beyond the US because global investors closely monitor American interest rates and bond yields while deciding where to allocate capital.
Crude Oil Moves Back Towards $100
Oil prices are another major concern for investors.
Brent crude had moved down after reaching around $98 per barrel but later climbed back towards the $100-per-barrel mark.
Expensive crude is particularly important for countries such as India because higher oil prices can increase the cost of imports and put additional pressure on inflation.
If inflation remains elevated, central banks may have less room to reduce interest rates. Higher borrowing costs can, in turn, affect consumer spending, business investment and corporate earnings.
The report also links the recent rise in crude prices to tensions between the US and Iran that began in February.
IT Stocks Buck the Market Trend
While most sectors declined, IT stocks managed to move in the opposite direction.
The Nifty IT index gained around 0.9% during the session.
One factor mentioned in the report was weaker-than-expected US inflation data for August. This reduced expectations of another US Federal Reserve rate hike later in the month, providing some support to technology stocks.
The performance of IT stocks therefore stood out against the broader market weakness.
Kotak Mahindra Bank Rises After CEO Appointment
Kotak Mahindra Bank was another notable stock on the positive side.
The bank’s shares gained around 3% after the appointment of Anup Kumar Saha as its new CEO. His tenure is set to run for three years.
The stock’s movement provided some relief in the financial space even as the broader market remained under pressure.
What Investors Should Watch Next
The current market weakness is being driven by several factors rather than a single event.
Investors are now likely to keep a close eye on:
- Foreign institutional investor flows
- Crude oil prices
- US Treasury yields
- Global interest-rate expectations
- Inflation data
- Performance of major sectors such as banks, IT and automobiles
The combination of expensive oil, higher global bond yields and continued foreign selling could keep volatility elevated.
At the same time, individual sectors and companies may continue to perform differently depending on their earnings outlook and exposure to global markets.
Bottom Line
The Indian market has entered an unusual phase, with the Sensex and Nifty registering their eighth consecutive weekly decline. The October 1 session added to that pressure, with the Sensex closing at 71,909 and the Nifty at 22,421.
Foreign investor selling, higher crude prices and elevated US bond yields are currently among the major factors influencing sentiment. However, the IT sector and selected stocks such as Kotak Mahindra Bank managed to buck the broader trend.
For investors, the coming sessions will be important in determining whether the market can stabilize or whether selling pressure continues.
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Disclaimer
This article is intended for informational and educational purposes only. The information provided is based on publicly available data and reports and should not be considered investment advice, a recommendation, or a guarantee of future market performance.
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Nitish Kumar Sharma is the Founder, Chief Executive Officer (CEO), and Editor-in-Chief of Learn Onex. He leads the platform’s vision, editorial strategy, content standards, and long-term growth initiatives with a focus on financial education and investor awareness.