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Bears take control over Indian markets amid foreign fund outflows, geopolitical concerns
Jan-23-2026

Bears tightened grip over Indian markets, with Sensex and Nifty settling with cut of around 2.50% in passing week. Traders were concerned amid tensions between U.S. and European allies over Greenland, even though Trump struck a conciliatory tone. Persistent foreign fund outflows, tepid corporate earnings, mixed economic data and weakness in rupee also weighted down on sentiments.

Some of the major developments during the week are:

CII’s Business Confidence Index climbs to five-quarter high of 66.5 in Q3 FY26: The Confederation of Indian Industry (CII) has said that its Business Confidence Index (BCI) climbed to a five-quarter high of 66.5 in Q3 FY26, driven by optimism around demand, profitability, and investment conditions.

December sees slower growth in eight key infrastructure sectors output: The government data has showed that eight key infrastructure sectors output grew at a slower pace of 3.7% in December 2025 as compared to 5.1% in December 2024, amid a dip in production of crude oil, natural gas, and refinery products.

India, UAE set target of $200 billion in annual trade by 2032: India and the UAE have unveiled plans for a strategic defence partnership and finalized an LNG pact, leaders of both the countries set a target of $200 billion in annual trade by 2032 while outlining a broad agenda to strengthen bilateral ties.

December sees slight increase in retail inflation for farm & rural workers: A labour ministry has said that the year-on-year inflation rate for Agricultural Labourers (AL) and Rural Labourers (RL) stood at 0.04% and 0.11%, respectively, in December 2025, mainly due to firming up of certain food items.

Business activity in India’s private sector accelerates in January: India’s flash Purchasing Managers’ Index (PMI) data report has showed that business activity in the country’s private sector bounced back sharply in January 2026, after losing some momentum at the end of the 2025 calendar year.

BSE movement for the week

The Bombay Stock Exchange (BSE) Sensex slipped 2032.65 points or 2.43% to 81,537.70 during the week ended January 23, 2026. The BSE Midcap index losses 1939.78 points or 4.20% to 44,246.27, while Smallcap index slipped 2876.6 points or 5.79% to 46,825.31. On the sectoral front, S&P BSE Realty was down by 753.01 points or 11.33% to 5,895.17, S&P BSE Consumer Durables was down by 3,173.52 points or 5.29% to 56,848.61, S&P BSE Consumer Discretionary Goods & Services was down by 484.63 points or 5.04% to 9,131.36, S&P BSE Power was down by 255.97 points or 4.07% to 6,028.86 and S&P BSE Healthcare was down by 1,544.14 points or 3.60% to 41,313.49 were the top losers, while there were no gainers on the BSE.

NSE movement for the week

The Nifty slipped 645.70 points or 2.51% to 25,048.65. On the National Stock Exchange (NSE), Nifty Mid Cap 100 decreased 2722.15 points or 4.55% to 57,145.65, Nifty Next 50 lost 2597.35 points or 3.77% to 66,260.55, Bank Nifty was down by 1622.05 points or 2.70% to 58,473.10 and Nifty IT was down by 848.15 points or 2.17% to 38,238.50.

FII transactions during the week

Foreign Institutional Investors (FIIs) were net sellers in equity segment in the week, with gross purchases of Rs 84,495.25 crore and gross sales of Rs 95,563.59 crore, leading to a net outflow of Rs 11,068.34 crore. They also stood as net buyers in the debt segment with gross purchases of Rs 12,677.01 crore against gross sales of Rs 12,115.19 crore, resulting in a net inflow of Rs 561.82 crore. In hybrid segment, FIIs stood as net sellers, with gross purchases of Rs 121.16 crore and gross sales of Rs 150.06 crore, leading to a net outflow of Rs 28.90 crore.

Industry and Economy

The International Monetary Fund (IMF) has increased India's Gross domestic product (GDP) growth forecast for the fiscal year 2025-26 (FY26) by 0.7 percentage point to 7.3 percent from its October projection. This upward revision is attributed to the better-than-expected outturn in the third quarter of the year and strong momentum in the fourth quarter. In its World Economic Outlook (WEO), IMF has also revised India's growth projection to 6.4 per cent for the next fiscal year (FY27), from its earlier estimate of 6.2 per cent. It also expects growth to settle around 6.4 percent in FY28 as cyclical and temporary factors wane. Talking on inflation, IMF said it is expected to go back to near target levels after a marked decline in 2025 driven by subdued food prices. 

Outlook for the coming week

In the passing week, Indian markets ended deep in red amid global tariff uncertainties. Besides, India’s output of eight key infrastructure sectors grew at a slower pace.

In the coming week, traders will be eyeing the Industrial Production data, slated to be released on January 28. Government Budget Value, Foreign Exchange Reserves data going to be out on January 30.

In a result heavy season lots of major companies like Axis Bank, Tata Consumer Products, Larsen and Toubro, Maruti Suzuki India, TVS Motor Company, ITC, One 97 Communications, Voltas, Bajaj Auto, Glenmark Pharmaceuticals, Jindal Steel, Nestle India, NTPC, and Sun Pharmaceutical Industries are likely to release their results during the week.

On the global front from the US, traders will first be eyeing Durable Goods Orders, and Chicago Fed National Activity Index on January 26; Redbook YoY, Richmond Fed Manufacturing Index, and Dallas Fed Services Index on January 27; Fed Interest Rate Decision, Balance of Trade, and Initial Jobless Claims on January 29; Fed Balance Sheet, Chicago PMI, Baker Hughes Oil Rig Count, and Core producer prices index on January 30.

Top Gainers 

  • Dr. Reddy's Laboratories up by 5.11% was the top gainer on Nifty for the week - Dr. Reddy's Lab traded higher on reporting better-than-expected Q3 earnings, even though, it reported 14.42% YoY fall in its consolidated net profit at Rs 1,209.90 crore during Q3. Besides, it has exhibited strong execution in Europe, India and Emerging Markets with revenue from Europe, India and Emerging Markets rising 20%, 19% and 32% YoY.
  • Hindustan Unilever (HUL) up by 2.08% was another top gainer on Nifty for the week - HUL is set to embed AI, machine learning, industrial IoT, and digital twins into core operations, to enable its sites to anticipate constraints, optimise performance dynamically, and manage volatility with greater confidence. Besides, the World Economic Forum has designated its factories in Gandhidham, Gujarat and Pondicherry, as Advanced 4IR Lighthouse sites.

Top Losers 

  • Adani Enterprises down by 13.59% was the top loser of the week on Nifty - Adani Enterprises came under pressure along with other Adani Group stocks after the US Securities and Exchange Commission sought US court’s permission to personally email summons to Adani Group’s chairman Gautam Adani and group executive Sagar Adani over alleged fraud. Moreover, investors opted to take cautious approach ahead of the company’s Q3FY26 earnings release.
  • Wipro down by 10.86% was another top loser of the week on Nifty - Wipro traded under pressure after its third quarter earnings failed to match street expectations. The company has reported 7% fall in its consolidated net profit at Rs 3119.00 crore for Q3FY26 as compared to Rs 3353.80 crore for the same quarter in the previous year. Besides, weaker-than-expected near-term guidance has sparked caution among investors.

Technical viewpoints

During the week, CNX Nifty touched the highest level of 25,873.50 on January 19 and lowest level of 24,919.80 on January 21. On the last trading day, the Nifty closed at 25,048.65 with weekly loss of 645.70 points or 2.51 percent. For the coming week, 24,687.80 followed by 24,326.95 are likely to be good support levels for the Nifty, while the index may face resistance at 25,641.50 and further at 26,234.35 levels.

US Market

The U.S. markets traded mostly lower during the week amid renewed concerns about a trade war between the U.S. and Europe over President Donald Trump's efforts to take control of Greenland.

Some of the major developments during the week are:

U.S. consumer price growth matches estimates in November: The Commerce Department said its personal consumption expenditures price index rose by 0.2 percent in November, matching the growth seen in October along with Street estimates.

Pending home sales in U.S. pull back far more than expected in December: Pending home sales plummeted by 9.3 percent to 71.8 in December after surging by 3.3 percent to 79.2 in November. Street expected pending home sales to dip by 0.3 percent.

U.S. GDP surges 4.4% in Q3 of 2025: Real gross domestic product spiked by 4.4 percent in the third quarter compared to the previously reported 4.3 percent surge. Street had expected the pace of growth to be unrevised.

Weekly jobless claims in U.S. inch up in week ended January 17: Initial jobless claims crept up to 200,000, an increase of 1,000 from the previous week's revised level of 199,000.

U.S. construction spending climbs in October: Construction spending climbed by 0.5 percent to an annual rate of $2.175 trillion in October after falling by 0.6 percent to an annual rate of $2.164 trillion in September.

European Market

European markets remained subdued during the passing week, due to geopolitical and trade tensions linked to Greenland.

Some of the major developments during the week are:

Eurozone current account surplus shrinks in November: The seasonally and working-day-adjusted current account surplus fell to EUR 9.0 billion from EUR 27.0 billion in October.

Eurozone construction output falls most in 6 months: The data from Eurostat showed that construction output dropped 1.1 percent monthly in November, reversing a 1.7 percent increase in October. 

Eurozone inflation eases to 1.9% in December: The harmonized index of consumer prices rose by revised 1.9 percent year-on-year following an increase of 2.1 percent in each of the previous two months.

German economic confidence strongest since July 2021: The economic sentiment index rose to 59.6 in January from 45.8 in the previous month, reaching the highest since last July 2021.

Italy current account gap narrows in November: The Bank of Italy reported that the current account gap narrowed to EUR 1.3 billion from EUR 2.2 billion last year.

Asian Market

Asian markets traded mixed during the passing week, amid easing geopolitical and trade tensions after U.S. President Donald Trump signaled pausing proposed tariffs against eight European countries over Greenland ownership.

Some of the major developments during the week are:

Japan's core inflation slows in December: Japan's headline inflation rate slowed sharply to 2.1 percent in December, its lowest level since March 2022, on the back of government subsidies.

Japan posts trade surplus in December: Japan posted a merchandise trade surplus of 105.7 billion yen in December. That missed forecasts for a surplus of 357.0 billion yen and was down from 316.7 billion yen in November.

South Korea Q4 GDP unexpectedly contracts: South Korea’s economy contracted by 0.3% QoQ in the three months to December 2025, reversing a 1.3% expansion in Q3 and missing expectations for a 0.1% increase.

South Korea exports rise in first 20 days of January: South Korean exports rose 14.9 percent year over year in the first 20 days of January, led by a 70 percent jump in semiconductor shipments.

China keeps benchmark lending rates unchanged: The People's Bank of China left its benchmark loan prime rate unchanged as expected, despite signs of cooling growth and a prolonged debt crisis in the real estate sector.
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