On January 8, Indian markets fell below the 50-day moving average (DMA) for the first time since October last year. This has shown signs of increasing decline in the market. This is the time for investors to exercise caution. Sensex and Nifty have reached 50-DMA for the first time after October 1, 2025.
The indices touched this level for a short time in December
Big selling was seen in the market on January 8. Sensex fell 780 points or about 1 percent to 84,180 points. Nifty also fell by 1 percent or 264 points and closed at 25,877. Even in the beginning of December, both the indices had gone below this level for a short time. But, he recovered from that level immediately.
Market decline due to US tariff related bill
Independent analyst Deepak Jasani said that unless Nifty closes above the 50-DMA of 26,000, the market may see further decline. In such a situation, Nifty may fall to the level of 25,460. The reason for the decline in the market is the American bill, if passed, the US will get the right to impose higher penalties on countries purchasing oil from Russia.
Big fall in oil and capital goods stocks
Shares of refining companies fell on January 8. These included Indian Oil Corporation (IOC) and Hindustan Petroleum (HPCL). There was also a decline in the shares of capital goods companies due to the news of lifting of restrictions on imports from China. Shares of BHEL and LND closed down. Jasani said that due to repeated negative news, investors book profits and keep themselves away from investing for some time.
These levels will be most important for Nifty and Sensex
Some experts say that as long as Nifty remains below 26,000 and Sensex remains below 84,500, weakness in the market may continue. In such a situation, Nifty may fall to 25,750-25,700, while Sensex may fall to 84,000-83,700. If Nifty closes above 26,000 then it may move towards 26,075-26,100. Sensex may go up to 84,800-85,000 if it closes above 84,500.
If America increases tariffs, growth may also be affected.
Harsimran Sahni of Anand Rathi Global Finance said that India’s impact is not going to be limited to just hindrance in trade. This may also affect the economy. Growth may slow down due to high tariffs. Rising energy prices will make it difficult to control inflation. Due to this, the government will have to try to balance supply and demand in the domestic market. This will affect liquidity. The government may need to take more loans.