Nifty 50 drops 13% from peak! 5 Warning signs of a tough market ahead
Last September, experts predicted Nifty 50 could hit 28,000 soon. Instead, the market took a sharp downturn.
Nifty 50 has dropped 13% from its record high of 26,277 on September 27. Since October, the index has declined every month. On February 14, it fell 0.44% to 22,929.25, marking its eighth straight losing session.
While some recovery may come as the market enters oversold territory, a new bull run looks unlikely. Experts warn of more pressure ahead, despite occasional relief rallies.
Why is the market struggling? Here are five key reasons:
1. Trump’s Tariff Shock
US President Donald Trump has rattled global markets with new trade policies. He announced reciprocal tariffs, meaning the US will match tariffs imposed by other countries. This move threatens a major trade war.
Investors remain cautious, waiting for clarity. “The tariff tension will keep markets under pressure,” said Pankaj Pandey, head of research at ICICI Securities.
2. Economic Slowdown
India’s economy faces growing challenges. A weak manufacturing sector and slow corporate investments have lowered growth projections.
The Reserve Bank of India (RBI) recently cut its GDP forecast. It now expects 6.7% growth for 2025-26, down from earlier estimates.
3. Rupee Under Pressure
The Indian rupee has weakened against the dollar, raising concerns. A weaker rupee makes imports costlier and increases inflation risks.
Foreign investors have pulled out funds, adding to market instability.
4. Global Uncertainty
Geopolitical tensions, including the US-China trade war and ongoing Middle East conflicts, are affecting investor sentiment.
Rising oil prices and global supply chain disruptions add to economic uncertainty.
5. Interest Rate Worries
While RBI has maintained interest rates, inflation concerns may push policymakers to reconsider. Higher rates could slow growth further.
What’s Next?
Experts predict continued market volatility. While long-term prospects remain strong, short-term challenges could limit gains.
Shankar Sharma, founder of GQuant, remains cautiously optimistic. “India offers great opportunities, but short-term pressure will persist,” he said.
Investors must brace for more turbulence before stability returns.
