Indian stocks finished Monday’s trading session much lower. The Nifty ended the day at 25,960.55, down 0.86%, while the Sensex closed at 85,102.69, down 0.71%. The Nifty Bank closed at 59,238.55, down 0.90%, indicating that the pressure was equally evident in the banking sector. The BSE SmallCap and midcap indices both saw a 2% decline.
A combination of domestic and international worries drove investors to adopt a risk-averse mindset, rather than a single cause for the precipitous decline. Small and midcap stocks suffered the most. Ahead of the approaching holiday season, investors moved their money back to large caps, demonstrating a distinct shift in their willingness for risk.
As markets awaited the US Federal Reserve’s policy announcement later this week, which usually affects international capital flows, the world’s tone remained cautious.
The Indian rupee’s ongoing weakening, which kept it close to its previous lows, added to the pressure. In the meantime, foreign institutional investors (FIIs) sold shares for six days in a row in December.
