Stock Market Today: Sensex down 400 pts, Nifty near 26,050

The equity benchmark indices extended their decline to the third straight session on Tuesday as weakness in the rupee, continued foreign fund outflows and profit-booking in private bank stocks weighed on investor sentiment.
The Sensex fell 427 points or 0.49 percent to an intraday low of 85,215.12, retreating after touching an all-time intra-day high in the previous session. The Nifty slipped 129 points or 0.49 percent to 26,046.85.
On Monday, the Sensex pared early gains and ended 64.77 points or 0.08 percent lower at 85,641.90. During the day, the benchmark jumped 452.35 points or 0.52 percent to hit a record intra-day high of 86,159.02.
The Nifty dipped 27.20 points or 0.10 percent to settle at 26,175.75. During the day, it climbed 122.85 points or 0.46 percent to hit a lifetime high of 26,325.80.
ICICI Bank, HDFC Life Insurance Company and InterGlobe Aviation were among the major laggards in the Nifty50 index, declining up to 2 percent, while Dr. Reddy's Laboratories and Asian Paints were among the major gainers, rising up to 1 percent.
Key factors behind market decline
1) Decline in Indian currency: The rupee opened lower at 89.70 against the US dollar and later touched a record low of 89.85, down 32 paise from its previous close. Traders said the fall was driven by strong dollar demand from corporates, importers and foreign portfolio investors, along with elevated crude oil prices.
2) Persistent FII selling: Foreign Institutional Investors sold equities worth Rs 1,171.31 crore on Monday, marking the third straight session of outflows this month. Persistent FII selling typically puts pressure on domestic equities as it signals reduced overseas appetite for risk assets.
"The absence of sustained buying interest near record high levels for four sessions indicates a potential pause in market momentum," Osho Krishan, chief manager of technical and derivative research at Angel One told Reuters.
The consolidation near record high levels also shows that investors are not chasing the index at elevated levels as they await a meaningful pullback before considering fresh positions, Nilesh Jain, head of technical and derivatives research of equities at Centrum Broking told Reuters.
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3) Weak global cues: Weak trends in global markets also added to the cautious mood. Key Asian indices, including Shanghai’s SSE Composite, traded lower, while US markets ended Monday’s session in the red.
4) Selling in bank stocks: The Nifty private bank index fell up to 0.4 percent as the banks reacted to Nifty Bank weight changes with heavyweights HDFC Bank and ICICI Bank among top losers in the index.
Technical View
Anand James, Chief Market Strategist at Geojit Financial Services, said momentum was muted in the previous session, with buyers stepping back and allowing the index to drift lower. He said bulls may attempt to regain strength if the Nifty moves back into the 26,110–26,060 range. Failure to hold this band could open the door to 25,860–25,700 or even 25,300, though such a sharp decline appeared less likely on Tuesday.