Sensex 300 pts; Nifty Falls Below Key 25,550 Level

Mumbai, 6 February 2026 – Indian benchmark equity indices opened sharply lower on Friday, with the BSE Sensex slipping about 300 points and the Nifty50 breaking below the 25,550 mark, as investors turned cautious ahead of the Reserve Bank of India’s (RBI) upcoming Monetary Policy Committee (MPC) meeting. The weakness reflected a combination of profit-booking, heightened RBI policy uncertainties, and weak global cues that weighed on risk appetite.

Market Performance Snapshot

At approximately 9:45 a.m. IST, the Sensex was down roughly 274 points (-0.33%), trading around 83,039, while the Nifty50 slipped nearly 100 points (-0.39%) to 25,542.85. Broader indices also traded in negative territory, with small-cap and mid-cap segments witnessing accelerated selling pressure.

Key Factors Behind the Decline

1. RBI Policy Watch & Jitters

Investors remained on edge ahead of the RBI’s MPC announcement. Though markets widely expect the central bank to maintain the repo rate at 5.25% with a neutral stance, uncertainty around the growth outlook, future liquidity conditions, and forward guidance triggered risk-off positioning among traders. Such policy ambiguity often leads to increased volatility as participants recalibrate positions.

2. Profit Booking After Recent Gains
Following modest rallies in previous weeks, several traders booked profits, especially in heavyweight counters, amplifying downward pressure on the indices. Profit taking is a common phenomenon when markets sit near key technical supports.

3. Weak Global Cues
Asian markets remained under pressure, while global equities struggled amid lingering concerns over technology stock valuations and weak macro data. Such spillovers often affect Indian markets, particularly in sectors linked to global demand and foreign investor flows.

4. Sectoral Headwinds
Markets witnessed broad-based weakness. The Nifty IT index, in particular, extended losses, pressured by fears of technology disruption and investor concerns about subdued earnings visibility. Export-oriented sectors typically feel the impact of a global risk-off sentiment first.

5. Increased Volatility Measures
The India VIX, often referred to as the fear gauge of Indian markets, traded higher, suggesting elevated uncertainty and anticipated volatility in the near term. A rising VIX usually corresponds with defensive trading behaviour.

Expert Commentary

Market strategists emphasise that the prevailing downside bias is largely technical driven by risk management ahead of a major policy event rather than fundamental deterioration. If the RBI’s statement later today provides clear forward guidance on growth and liquidity, markets may stabilise. However, any hint of cautious or restrictive tone could prolong the correction.

Technical Outlook

• Support Levels: The Nifty is eyeing immediate support near the 25,450–25,500 zone.

• Resistance Levels: A sustained move above 25,800–25,900 could signal renewed confidence and short-term relief rallies.

• Trend Indicator: Until clear directional cues emerge from the RBI, volatility and range-bound trading are likely.

Why It Matters

The market fall reflects nervousness ahead of the RBI policy outcome, as investors cut risk before key cues. The Nifty slipping below 25,550 is technically significant and could invite further short-term selling if it fails to reclaim this level. Weak global cues and profit-booking in heavyweights are adding pressure, while RBI commentary on inflation, growth, and liquidity will be key in deciding whether markets stabilise or remain volatile in the near term.

Conclusion

The Indian market’s early slides on Friday reflect a classic “policy event caution” setup. Weak global trends and profit booking compounded selling pressure, while the RBI’s future guidance remains a central focus for traders and investors alike. Market participants are advised to stay alert to policy signals, manage risk judiciously, and closely watch sector rotations in response to evolving macroeconomic cues.