Indian Benchmark Indices Hit Three Month Lows Following Steepest Single Day Drop in Eight Months

On January 21, 2026, Indian equity markets INexperienced a sharp decline as benchmark indices recorded their steepest single-day percentage drop in more than eight months. The Nifty 50 NSEIfell by 1.4 percent to reach a three-month low, while the BSE Sensex BSESNdropped 1.3 percent. Following this selloff, the Nifty 50is now down 4.3 percent from its record highs, and the BSE Sensexhas retreated 4.6 percent from its peak. Technical indicators show that the Nifty 50 has slipped below its 20-, 50-, and 100-day moving averages and is currently hovering just above its 200-day moving average.

The market downturn was driven by a combination of sustained foreign selling and global uncertainty. Foreign Portfolio Investors (FPIs) have offloaded $3.23 billion of Indian stocks in January 2026 alone, extending a trend from 2025 when FPIs sold a record $19 billion in equities. Global sentiment was further pressured by a broad-based selloff in Wall Street and European equities overnight, while other Asian markets dropped 0.2 percent. Investors remain cautious amid geopolitical threats from the United States US, where President Donald Trump donald trumphas spoken of acquiring Greenland and reigniting a trade war with the European Union EU.