Why Market Is Down Today: Key Reasons & Updates

Market Down Today- A stock market decline continued for the second day, with equities falling sharply as investors waited for a Federal Reserve policy statement, which added to the unease prevailing in the market.

Market sentiment was weakened by a US threat of tariffs against India's rice exports.

 

Market Update

Nifty Today: By 9.50 a.m. the Sensex today fell by 633.90 points (0.74%) to 84,468.79 and the Nifty fell by 211.25 points (0.81%) to 25,749.30.

All 16 major sectoral indices were negative.

 

 

Key Market Crash Reason

 

1) Fed meeting outcome jitters: Before the Fed's two-day meeting began, investors were on the edge of their seats attempting to predict if the Fed would make a 25 basis-point cut on the forthcoming Wednesday. 

Investors in the market are trying to gauge the timing of the Fed's rate cuts for 2026 as inflation is still a big factor in the economy and the markets are expecting the US economy to do relatively well.

 

2) US-China tariff threat on rice exports: US President Donald Trump has expressed concern over the dumping of rice into the US economy as he looks to impose tariffs on rice exports from India, putting pressure on the exports of rice. 

The US is the fourth largest market for Indian basmati rice with 270 thousand metric tonnes exported. Indian exporters have unfenced the export Indian base price with US importers absorbing the tariffs, thereby passing the additional costs onto the consumers.

 

3) Decline in Rupee: Demand from corporates, foreign portfolio investors, and importers has increased, weakening the Rupee by 10 paise to 90.15 in intraday trade. Waiting on the federal policy statement has traders in a holding pattern. The currency decreased from a previous close to 90.15 in interbank foreign exchange.

"Sentiment remains fragile with FIIs continuing to sell, the Rupee weakening to 90 per USD, and global cues continuing to soften, despite hopes on a potential US Fed cut due December 10," stated Prashanth Tapse, Senior VP Research from Mehta Equities Ltd.

 

4) FII Selling: The persistent selloff from foreign institutional investors continues to impact the stock market decline. Selling ₹655.59 crore on Monday was the first FII outflow of the eighth straight session. The absence of foreign euros usually results in market weakness while global uncertainty remains.

 

5) Weak Global Cues: Weak global cues also continued to persist. Caution before Fed policy meetings was a common sentiment across indices, with South Korea's KOSPI and Hong Kong's Hang Seng printing red, and Shanghai's SSE Composite slipping lower. The US markets also printed red on Monday.

 

6) Broader markets extend decline: Mid and small-cap shares continued to decline in today's session, with the indices falling by up to one %. In the previous session, the Nifty Midcap 100 fell by 1.83%, Nifty Small Cap 100 fell by 2.61%, this was the steepest single day fall since April 7, 2025 and represents a six-month low.

 

7) Selling in IT shares: IT stocks were one of the main drags. Coforge and Persistent Systems were some of the biggest losers and all 10 components of the Nifty IT index were trading in the red.

 

(Source: MoneyControl)

 

DISCLAIMER: This blog is NOT any buy or sell recommendation. No investment or trading advice is given. The content is purely for educational and information purposes only. Always consult your eligible financial advisor for investment-related decisions.