Benchmark indices declined by up to 2.51% during the week, logging their worst weekly loss in four months, as investors turned risk-averse amid depressed market sentiment.
Both the Sensex and the Nifty recorded losses in all but one trading session of the week, largely driven by geopolitical tensions, mixed Q3 corporate earnings, and continued depreciation of the rupee against the US dollar that hit another fresh record low on Friday.
On Friday, the Sensex slumped 769.67 points, or 0.94%, to close at 81,537.70, erasing all gains made in the previous session. The Nifty fell 241.25 points, or 0.95%, to end at 25,048.65.
On a weekly basis, the Sensex and the Nifty declined 2.43% and 2.51%, respectively. The broader indices performed worse, with the BSE Midcap and BSE Smallcap indices falling 4.2% and 5.8%, respectively. The BSE Smallcap’s weekly decline was the steepest in eleven months (since February 14).
Broad-based selling made investors poorer by Rs 16.3 lakh crore during the week, of which Rs 6.96 lakh crore was wiped out on Friday alone.
‘Greenland Factor’ and FPI Exodus
“Indian equity markets remained cautious and volatile throughout the week, pressured by renewed global trade tensions and persistent foreign investor outflows. Fresh US tariff threats against European nations linked to the Greenland issue dampened global risk appetite, prompting a shift toward safe-haven assets,” said Vinod Nair, Head of Research at Geojit Investments.
Since their recent peak on January 2, the Sensex and the Nifty have declined 4.93% and 4.86%, respectively. Over the same period, the BSE Midcap and BSE Smallcap indices have fallen 6.93% and 9.81%, respectively. As a result, investor wealth has eroded by nearly Rs 30 lakh crore since January 2.
Foreign portfolio investors offloaded shares worth $1.16 billion (Rs 10,639 crore) during the week, while domestic institutional investors purchased equities worth Rs 20,746 crore.
So far in January, FPIs have sold shares worth $3.7 billion (Rs 33,143 crore), marking the highest monthly outflow in five months. In contrast, DIIs have bought equities worth Rs 54,823 crore during the month so far.
Except for Thursday, market breadth remained negative on all trading days of the week. All sectoral indices ended the week in the red. Realty was the worst-performing sector, plunging 11.33%, followed by consumer durables, services, telecom, utilities, and consumer discretionary, each falling over 5%.
Eternal, Adani Ports, Reliance Industries, ICICI Bank, and Titan Company were the top Sensex laggards, declining by up to 10.05% during the week.
Adani Group
All Adani group shares declined sharply on Friday and were among the top laggards after reports that the US market regulator sought to advance its fraud case against the conglomerate’s billionaire chairman, Gautam Adani. Shares of the group’s flagship firm, Adani Enterprises, plunged 10.76%, while Adani Ports fell 7.02%, making them the top losers in the Nifty 50 pack. Other major laggards included Adani Green Energy (down 14.63%) and Adani Energy Solutions (down 11.97%).
Overall, about Rs 1.12 lakh crore was wiped out from the Adani group’s total market capitalisation on Friday. Interestingly, exactly three years ago, Adani group stocks were hit by the US short-seller Hindenburg report, which had eroded nearly Rs 12.43 lakh crore from the group’s market capitalisation in less than a month.
Looking ahead, markets will closely track US consumer confidence data due on Tuesday, followed by the US Federal Reserve’s interest rate decision and the Union Budget 2026, which are expected to remain key triggers in the coming week, said Siddhartha Khemka, Head of Research – Wealth Management at Motilal Oswal Financial Services.