Sensex plunged by 900 points in a single day, dropping below the record-breaking 71,000 mark. Despite a strong performance throughout the week, the benchmark Sensex experienced a significant decline on Wednesday, falling below 71,000 after reaching this historic milestone earlier in December 2023.

Following the announcement of the results of the 2023 state assembly elections on December 3 and 4, the BSE Sensex had surpassed the 71,000-point mark and maintained its upward trajectory. However, on Wednesday, December 20, the Sensex witnessed a sharp decline of approximately 900 points as the market closed. Currently, the BSE Sensex is situated below the 70,500 mark, with major stocks like TCS and Hindustan Unilever displaying notable decreases.

In addition to Sensex, NSE Nifty also fell below the 21,200 mark on Wednesday after a record-breaking performance in the Indian stock market. This significant downturn occurred just two weeks after both Nifty and Sensex reached their historic highs.

Several factors contributed to the market’s decline. Bank, metal, and auto stocks in India experienced a gradual decline throughout the market session on Wednesday. Major IT and bank stocks, with the exception of HDFC, also registered marginal declines on December 20. The resurgence of Covid-19 cases across India, driven by the new Covid sub-variant JN.1 initially detected in Kerala, added to the market’s concerns.

Foreign institutional investors (FIIs) played a role in the sharp decline, as they offloaded Indian shares during the last market session, selling approximately ₹601.52 crore. In contrast, Domestic Institutional Investors (DIIs) only bought ₹294 crore.

Despite the current decline in Sensex, HDFC Securities had previously predicted that the early months of 2024 would witness an eight to ten percent increase in Nifty and Sensex, reaching new market highs.