The Indian stock market correction deepened last week as benchmark indices, such as the Sensex and Nifty 50, lost over 1%, rattled by foreign capital outflows and global instability. For the week ended June 13, the Nifty 50 slipped 1.14%, while the Sensex dropped 1.30%, raising concerns about further downside risk.
Indian Stock Market Correction: Key Indices Performance
- Nifty 50: -1.14%
- Sensex: -1.30%
- Nifty Bank: -1.9%
- BSE Midcap: -0.90%
- BSE Smallcap: -0.13%
The weakness was broad-based, with frontline stocks like Adani Ports, Titan Company, HDFC Bank, ICICI Bank, and Hindustan Unilever witnessing weekly declines ranging from 3% to 5%.
Indian Stock Market Correction: Why Did Markets Fall?
1. Geopolitical Tensions
Rising instability in the Middle East has led to increased global uncertainty. This, in turn, has heightened risk aversion across equity markets, pushing investors toward safer assets.
2. FII Outflows
Foreign Institutional Investors (FIIs) continued to pull out capital amid global risk-off sentiment and cautious positioning ahead of the US Federal Reserve’s policy meeting.
3. Tariff-Related Concerns
Ongoing tariff threats and global trade worries also weighed on sentiment, especially for export-heavy sectors.
Indian Stock Market Correction:Expert Insights
Ajit Mishra, SVP of Research at Religare Broking, remarked:
“Markets remained under pressure and declined by over a per cent during the week, weighed down by rising geopolitical tensions and mixed global cues.”
He added that the indices gradually drifted lower through the week, eventually settling near weekly lows.
Indian Stock Market Correction: Can the Correction Continue?
1. Macro & Global Triggers to Watch
The coming week could remain volatile, with key triggers including:
- US Federal Reserve policy decision (on interest rate trajectory)
- Monsoon progress (vital for agriculture and rural demand)
- Crude oil prices
- WPI Inflation data
- Foreign capital flows
Investors will keenly track the Fed’s comments on rate cuts, especially in light of mixed economic signals from the US.
Indian Stock Market Correction: Technical Analysis-Key Levels to Watch
Nifty 50 Technical View
Amol Athawale, VP of Technical Research at Kotak Securities, offered the following insights:
- Nifty has formed a long bearish candle on the weekly chart.
- It is now trading below the 20-day SMA (24,850)—a bearish indicator.
Support & Resistance Levels:
- Immediate Support: 24,500
- Strong Support: 24,300 (50-day SMA)
- Upside Resistance: 24,750 → 24,850 → 25,000
“A move below 24,500 could intensify selling pressure, dragging the index to 24,300. On the flip side, crossing above 24,750 could trigger a short-term pullback,” Athawale said.
Nifty Bank Outlook
The Nifty Bank index, which underperformed the broader market with a 1.9% decline, failed to hold above the crucial 56,000 mark.
- Support Zone: 55,000–55,200
- Breakdown Support: 54,500 (50-day SMA)
- Upside Resistance: 56,100 → 56,300
- Key Breakout Level: 56,500
A drop below 55,000 may result in a deeper correction, while a decisive breakout above 56,500 could revive bullish momentum in the banking space.
Indian Stock Market Correction: Consolidation Phase or Start of a Downtrend?
According to Religare’s Ajit Mishra:
“Nifty has re-entered its consolidation zone of 24,400–25,200. A move outside this band will determine the next trend.”
- Breakdown Zone: Below 24,400 = downside toward 24,000
- Breakout Zone: Above 25,200 = potential rally to 25,600
In this consolidation phase, traders are advised to wait for a decisive breakout or breakdown before taking aggressive directional bets.
Indian Stock Market Correction: Investment Strategy for the Coming Week
Traders:
- Remain cautious and nimble, given the volatile environment.
- Watch support levels closely; consider light positions near 24,300–24,500 support zones.
- Avoid aggressive long positions until Nifty crosses 25,200 decisively.
Investors:
- Focus on quality stocks with strong fundamentals, especially in defensive sectors like FMCG and healthcare.
- Be selective in midcaps and smallcaps—use dips for staggered accumulation.
- Monitor global and domestic cues, especially FII data and inflation trends.
Conclusion: Volatility Ahead, Stay Stock-Selective
The current Indian stock market correction reflects a combination of global headwinds and domestic uncertainty. While technical indicators suggest more downside potential, markets could also rebound if global cues stabilize.
Until then, it’s a time for caution, not panic. A break below crucial support levels may deepen the correction, but a bounce from current zones can’t be ruled out, especially with key central bank meetings lined up.
FAQs
Q1: Why are Indian stock markets falling this week?
A1: Markets are under pressure due to Middle East tensions, foreign investor outflows, and global uncertainty around interest rates.
Q2: What are key technical levels for Nifty 50 next week?
A2: Support at 24,500–24,300; resistance at 24,750–25,000. A break above 25,200 could trigger a fresh rally.
Q3: Should investors panic during this correction?
A3: No. Investors should focus on quality stocks and avoid panic selling. Corrections are part of long-term investing.
Q4: Is Bank Nifty more vulnerable than Nifty?
A4: Yes, Bank Nifty underperformed last week and is showing weaker technical signals. Watch for support at 54,500.
Q5: What are the global cues affecting the Indian stock market?
A5: US Fed policy, crude oil prices, geopolitical tensions, and global interest rate expectations are key external drivers.
ZERODHA 1) : https://zerodha.com/open-account?c=EJ4366
Angelone 2) : https://tinyurl.com/2gloc3g6 or
Upstox3): https://link.upstox.com/9w4tNo1rK8au7VK47
