Indian equity markets witnessed their sharpest drop in four months on 8 January 2026. The BSE Sensex fell 780.18 points (−0.92 %) to close at 84,180.96, while the NSE Nifty 50 dropped 263.90 points (−1.01 %) to 25,876.85. Selling pressure was broad based – metals, information technology, energy and auto stocks led the decline. Sentiment was hurt by fears that the U.S. administration could impose steep tariffs on Indian goods, concerns over a potential Venezuelan crude supply deal, continued foreign institutional outflows and mixed global cues. The Nifty Midcap and Smallcap indices lost 1.96 % and 1.94 % respectively. Despite strong support from domestic institutions, overseas investors were net sellers; provisional data on 7 January (latest available) indicated foreign portfolio investors sold roughly ₹1,528 cr while domestic institutions bought around ₹2,889 cr in the cash segment.
Key Indices (8 Jan 2026 close)
Index/Benchmark
Closing level
Day’s change
% change
Open
Day’s High
Day’s Low
BSE Sensex
84,180.96
−780.18 pts
−0.92 %
84,778.02
84,945.78
83,860.24
NSE Nifty 50
25,876.85
−263.90 pts
−1.01 %
26,106.50
26,133.20
25,858.45
Nifty Bank
59,686.50
−309.55 pts
−0.51 %
59,909.40
60,076.15
59,636.55
Nifty Midcap 100
52,863.30
−1,058.85 pts
−1.96 %
53,515.30
53,531.50
52,823.60
Nifty Smallcap 100
16,643.80
−327.55 pts
−1.94 %
16,853.75
16,876.45
16,602.00
India VIX
15.41
+0.78 pts
+5.34 %
–
–
–
Sectoral Performance
Sectoral index
Close
Change
% change
Key Drivers
Nifty Metal
11,132.0
−391.80
−3.40 %
Biggest drag; concerns about potential U.S. tariffs hit metal producers like Hindalco, JSW Steel and Tata Steel.
Nifty IT
37,920.30
−772.50
−1.99 %
IT stocks fell after Wall Street’s tech rally showed fatigue; Wipro, TCS and Tech Mahindra were major losers.
Nifty Pharma
22,962.55
−322.30
−1.39 %
Profit booking; Dr Reddy’s Laboratories and Cipla slipped despite business updates.
Nifty FMCG
53,010.15
−482.35
−0.90 %
Consumer stocks pared gains; Hindustan Unilever and ITC declined.
Nifty Finance
27,672.60
−179.90
−0.65 %
Financials held relatively firm; SBI Life and ICICI Bank edged higher but NBFCs drifted lower.
Nifty Auto
28,414.95
−278.20
−0.97 %
Auto shares slid; Tata Motors and Bajaj Auto corrected on profit taking.
Nifty CPSE
6,469.65
−102.45
−1.56 %
Public sector enterprises declined; energy names like ONGC and Oil India corrected.
Nifty NMC (Mining & Commodities)
30,517.15
−500.80
−1.61 %
Commodity and basic resources stocks softened amid global tariff worries.
Nifty Midcap 100 & Smallcap 100
see above
Sharp correction across broader market – profit booking and valuation concerns led to a sell-off.
Note: All sectoral indices closed in the red; metals, technology and commodities saw the steepest declines while financials and FMCG showed relative resilience.
Weakness in metals and logistics; investor caution on capital expenditure.
Larsen & Toubro
4,028.40
−3.09 %
Capital goods stocks corrected after Trump’s comments on defence buybacks.
JSW Steel
826.30
−2.7 %
Tariff fears and profit taking.
Key Statistics
Market breadth: On the NSE, decliners outnumbered advancers 3:1. All sectoral indices except a handful of financial names closed negative.
Turnover: Combined cash turnover on NSE and BSE slipped to about ₹1.1 trillion (around 7 % below the month’s average) as traders stayed on the sidelines ahead of U.S. jobs data.
Foreign flows: Provisional data (latest available for 7 Jan 2026) indicated foreign portfolio investors were net sellers of about ₹1,528 crore, while domestic institutional investors bought roughly ₹2,889 crore. Sustained FII selling remains a key headwind.
Volatility: India VIX increased 5 % to 15.41, signalling an uptick in market volatility.
52‑week levels: The Nifty 50’s close of 25,876.85 is about 2 % below its 52‑week high of 26,373.20. The index’s 200‑day moving average lies near 25,039.
What Moved the Market
Tariff concerns: Comments from the U.S. administration hinting at possible tariffs of up to 500 % on Indian goods unnerved investors. Metals and capital goods stocks took the biggest hit on fears of export curbs.
Crude supply deal worries: Reports of a proposed Venezuelan crude supply agreement with Indian refiners weighed on oil & gas shares. ONGC, Oil India and IOC slid as investors braced for potential pressure on refining margins.
Weak global cues: Overnight, Wall Street ended lower as President Trump said defence companies should prioritise research spending over share buybacks, triggering a 470‑point fall in the Dow. Europe closed mixed; FTSE 100 shed 0.74 % while Germany’s DAX rose 0.92 %. In Asia on Thursday, markets were also mixed – Kospi +0.46 %, Jakarta Composite +0.38 %, Shanghai +0.09 % – while Hang Seng sank 1.19 % and Nikkei fell 1.09 %. Gift Nifty indicated a soft start.
Profit booking & valuation concerns: After a strong run in December, investors locked in profits, particularly in mid- and small-cap stocks. High valuations in IT and consumer names added to selling pressure.
FII selling: Foreign investors remained sellers amid concerns over global growth, geopolitical tensions and a strengthening dollar.
Stocks to Watch and Corporate Updates
Corporate developments (announced on/around 8 Jan 2026):
Infosys: Entered a strategic partnership with Cognition to deploy “Devin,” an AI software agent, across its internal engineering systems and client delivery models.
Tata Steel: Reported record quarterly crude steel production of 6.34 million tonnes in Oct–Dec 2025, up 12 % year‑on‑year due to improved output at Jamshedpur and Kalinganagar plants.
Cipla: Clarified that inspectional observations noted by the USFDA pertained to its subsidiary Pharmathen International SA; the company is evaluating the impact.
Adani Green Energy: Its wholly owned unit signed an agreement to supply a 20.8‑MW solar‑wind hybrid power plant to Asahi India Glass; the project is at Khavda, Gujarat.
Gland Pharma: Received U.S. FDA approval for olopatadine hydrochloride ophthalmic solution (0.7 %, OTC), opening a new revenue stream.
ONGC: Continued efforts to control the gas blowout at its offshore well; the company said operations were proceeding under expert supervision.
HUDCO: Signed a memorandum of understanding with the Chhattisgarh government to provide financing for affordable housing and infrastructure projects.
Titan Company: Launched beyond – a brand of lab‑grown diamonds – expanding its jewellery portfolio.
IRB Infrastructure: Announced a 12 % year‑on‑year increase in December toll collections on its expressways.
Stocks likely to be in focus on 9 Jan 2026:
Stock
Rationale
Infosys
Partnership with Cognition may boost AI‑driven revenue; watch for follow‑through buying after Thursday’s sell‑off.
Tata Steel & JSW Steel
Tariff concerns remain; watch for any clarification on U.S. trade measures.
Adani Green Energy
Signing of hybrid power pact could spur investor interest.
Cipla
Monitoring potential impact of USFDA observations; any updates may influence the stock.
Gland Pharma
FDA approval may attract buying interest.
Titan Company
Launch of lab‑grown diamond brand signals new growth; investor reaction will be watched.
ONGC & Oil India
Movement in crude prices and progress on the gas‑well containment to guide sentiment.
ICICI Bank & SBI Life
Among the few gainers; can attract defensive inflows if markets remain volatile.
Will remain sensitive to trade‑policy news; bounce likely if tariff fears recede.
Technical Outlook & Tomorrow’s Tone
Nifty 50: Technical charts show a bearish bias after a sharp sell‑off. The index broke below 26,000 but found support near 25,850–25,900. Analysts see strong support around 25,700; a decisive break below may drag the index toward the 200‑day moving average near 25,039. On the upside, the 26,150–26,200 zone is the immediate resistance; a close above could lead to a rebound toward 26,500–26,800. Momentum oscillators are oversold, suggesting a possibility of short‑term pullback but the overall structure remains weak.
Bank Nifty: The index is holding above its support band of 59,700–59,800. A fall below 59,700 could open the way toward 59,000–58,800. To negate the negative bias, it needs to sustain above 60,200. Traders should watch private bank heavyweights for cues.
Market tone for 9 Jan 2026: The tone is expected to remain cautious to sideways. Global markets continue to send mixed signals, and uncertainty around potential U.S. trade measures and upcoming U.S. jobs data could keep volatility elevated. The market may attempt a technical bounce from oversold levels, but traders should use rallies to lighten positions and focus on stock‑specific opportunities. Defensive sectors like healthcare, select financials and consumption may see relative buying.
Outlook for Tomorrow (9 Jan 2026)
Short‑term view: Markets are likely to open flat to slightly positive as oversold conditions provide scope for a technical rebound. However, up‑moves may be capped near the 26,150–26,200 zone on the Nifty. Traders should remain cautious, place tight stop‑losses and avoid aggressive long positions until clarity emerges on global trade issues.
Key triggers: U.S. jobs data (Non‑Farm Payrolls) and further statements on tariff policy; crude‑oil price movements; quarterly results scheduled from software majors (Infosys will release results soon). Watch FII flow data for any shift in foreign investor behaviour.
Disclaimer: This report is for informational purposes and does not constitute investment advice. Market levels and stocks mentioned are based on closing data from 8 January 2026.
