Huge Crash Again! Sensex, Nifty Slide After Two-Day Rally As Auto Stocks Weigh And Budget Caution Grows

Indian stock markets declined sharply on Thursday, ending a two-day rise as investors chose to book profits. Heavy selling was seen in auto stocks, while overall sentiment remained cautious after the US Federal Reserve paused interest rate cuts.

By around 10:30 am, the Sensex was down by over 450 points, trading near 81,900. The Nifty also slipped by nearly 140 points to around the 25,200 mark. The decline later deepened, with the Sensex falling more than 600 points during the session.

Auto and IT Stocks Drag Markets Lower

Selling pressure was visible across several sectors, with auto and IT stocks facing the biggest losses. Shares of InterGlobe Aviation, Asian Paints, and Mahindra & Mahindra fell by up to 3 percent, making them among the top losers on the Nifty50.

On the other hand, stocks like Tata Steel and Larsen & Toubro managed to gain up to 3 percent, offering some support to the market. However, overall market breadth remained weak, as more stocks declined than advanced.

Budget Worries and Global Signals Add Pressure

A major reason behind the market fall was caution ahead of the Union Budget. With the Budget just days away, investors preferred to reduce risk amid uncertainty over government decisions on spending, taxes, and reforms.

Global factors also played a role. Expectations of early interest rate cuts in the US have weakened, prompting some investors to move funds back to American markets in search of better returns.

Short-Term Caution, Not Panic

In a single session, investors lost nearly ₹3 lakh crore as market values dropped sharply. Experts said the fall reflects short-term caution rather than panic selling. Such volatility is common ahead of major events like the Union Budget.

Market participants believe stocks may continue to remain volatile until there is clearer direction from government policy announcements and global interest rate trends.