Market Rollercoaster: Why Did Sensex and Nifty 50 Just Drop? Exploring the Whys and Hows of Today's Indian Stock Market Dip

Today, the Nifty 50 ended down 338 points (1.51%) at 21,997.70, and the Sensex closed lower by 906 points (1.23%) at 72,761.89 in the stock market.

Today, the Indian stock market, represented by the Nifty 50 and the Sensex, dropped more than 1% on Wednesday, March 13. This happened following a slight increase in US inflation numbers for February, leading to worries that the US Federal Reserve might delay rate cuts beyond June.

Today, the Sensex dropped by more than 900 points, slipping below the 73,000 mark, while the Nifty fell by over 1% on March 13th. This marks the biggest one-day decline for the small cap index since December 2022, with a 5% decrease, while midcaps saw a 3% dip. Microcaps and SME stock indices also experienced a drop of around 5% each. As a result, the total market.

All other sectoral induces ended in red Including Power, Oil & Gas, Media, PSU Bank, Telecom and Metals all declined by more than 5℅.

Here are some mazor factors that the market experts believe that may have triggered this heavy selloff. 

1.Excessive valuations of stocks without any fresh catalyst in the market. Market reaches in the bubble zone especially in the Smallcap segment. 

2.The effect of domestic macro number or  the retail inflation number for February did not show remarkable growth and the factory output was weaker than expected. 

3.Rate cut uncertainty by the US Federal Reserve due to the increased inflation in February. As a result,  dollar index as well as the US market surged attracting capital inflows affecting Indian market badly.

4.Due to lac of any fresh catalyst the market is in a consolidation stage and a natural profit booking is happening in the market.