Domestic equities kicked off 2026 on a weak footing, extending their losing streak to a fifth straight session on Friday, as investors turned cautious due to uncertainty over India-US tariffs, geopolitical tensions including potential US trade measures linked to Russia-related sanctions and persistent foreign fund outflows. All eyes on the US Supreme Court ruling on the legality of Trump’s tariffs, which is expected later in the day.
Foreign portfolio investors pulled out nearly Rs 12,000 crore in Indian equities in 2026, according to NSDL data.
According to Vinod Nair, Head of Research, Geojit Investments, the market remains in a consolidation phase due to weak global cues and rising global bond yields, which are weighing on sentiment ahead of the positive Q3 earnings outlook.
Domestic GDP growth is expected to remain strong, and Q3 results should indicate a recovery led by mid-caps, potentially stabilising investor sentiment, he added.
BSE Sensex ended 604.72 points or 0.72 per cent lower at 83,576.24, after hitting an intraday low of 83,402.28. Nifty 50 dragged by 193.55 points or 0.75 per cent to 25,683.30 (near day’s low of 25,623). The broader market remained under pressure with mid-cap depreciating 0.7 per cent, while the smallcap index slumped close to 2 per cent.
The BSE Sensex and the NSE Nifty 50 shed about 2.5 per cent each this week. From its all-time high of 26,373 recorded on January 5, 2026, the index has now corrected about 2.62 per cent over the last four trading sessions, highlighting the shift from consolidation to a short-term corrective phase, said Sudeep Shah, Head – Technical and Derivatives Research at SBI Securities, said.
Fifteen of the 16 major sectors fell during the week. Mid-cap was the worst performer losing 3.1 per cent closely followed by small-cap that fell 2.6 per cent..
India VIX surged by 16 per cent to close near the 11 mark, a level that continues to be a cause for concern.
Joseph Thomas, Head of Research, Emkay Wealth Management, said during the week, the concerns related to Trump Tariffs came back to haunt the markets. “As the domestic markets were coming to terms with the existing tariff levels, Trump administration made an announcement of a possibility of 500% tariff on countries importing Russian oil. The impact on market sentiments is expected to spillover in to the next week as well, as it may lead to FII selling intensifying further. The upcoming earnings season would be keenly watched for any signs of earnings recovery,” he said.
Ajit Mishra – SVP, Research, Religare Broking, said that the small-cap index has corrected 3.8 per cent over the last two sessions.
On the sectoral front, oil & gas and IT indices posted modest gains, while realty and auto emerged as the top two losers.
Bank Nifty, however, has outperformed relative to the broader market despite posting losses.
Asian Paints, Jio Financial, Adani stocks, ICICI Bank major laggards
Asian Paints, ONGC, HCL Tech, and Bharat Electronics led the gainers among Nifty 50 constituents, while Adani Enterprises, NTPC, Adani Ports, ICICI Bank, and Jio Financial Services emerged as major laggards.
Market breadth remained decisively negative, underscoring the weak undertone, as 3,104 stocks declined against just 1,062 advances out of 4,342 stocks traded on the BSE, while 176 counters ended unchanged.
As many as 326 stocks hit 52-week lows compared with only 73 hitting 52-week highs. Despite the subdued sentiment, 10 stocks were locked in the upper circuit, while 9 hit the lower circuit.
Heavyweight stocks HDFC Bank and Trent shed 6-10 per cent during this week. In today’s trading session, IEX shares witnessed volatility as the CERC order on market coupling remained. Manappuram Finance dragged on reports that the central bank raised objections to Bain Capital’s plan to buy a controlling stake in the company.
Midcap & smallcap movers
Under the midcap index, National Aluminium, Oil India, Coromandal International, Ashok Leyland and Coforge soared 2-5 per cent, while Godrej Properties, Hitachi Energy, Glenmark and 360 One WAM dragged 3-5 per cent.
Among the small-cap index, Star Health led with 2 per cent gains, while IEX, Manappuram Finance and Tejas Networks fell 5-7 per cent.
Global markets
Asian markets ended higher.
European markets were trading in positive territory. US markets witnessed a mixed trend on Thursday.
Investor attention remains fixated on a possible US court ruling. Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said there is a high probability the verdict will go against Trump. Kaynat Chainwala, AVP Commodity Research, Kotak Securities, emphasised that if the court rules against the tariffs, concerns over an intensifying trade war could ease.
Additionally, investors will focus on key Q3FY26 IT earnings scheduled for release on Monday.
Published on January 9, 2026
