The Indian stock market experienced a significant decline today, Monday, June 2, 2025, with the Nifty 50 index dropping over 200 points to trade below 24,550, and the BSE Sensex falling more than 750 points to around 80,701.
Key Factors Behind Today’s Market Downturn
- Global Trade Tensions: Renewed concerns over U.S.-China trade relations have unsettled global markets. The U.S. administration’s plans to reintroduce tariffs on Chinese imports have raised fears of a potential trade war, leading to a cautious stance among investors worldwide.
- Weakness in IT and Metal Sectors: Domestic markets saw significant selling pressure in the IT and metal sectors. The Nifty Metal index declined by 1.4%, and the Nifty IT index fell by 1.25%, reflecting investor concerns over global demand and potential impacts of trade policies on these export-oriented industries.
- Investor Caution Ahead of U.S. Economic Data: Investors are awaiting key U.S. macroeconomic data releases, including employment figures and inflation metrics. The anticipation of these reports has led to a risk-averse approach, contributing to the sell-off in equities.
- Technical Market Levels: The Nifty 50 index breached critical support levels, notably falling below 24,600. This technical breakdown may have triggered stop-loss orders and accelerated selling pressure, exacerbating the market decline.
Despite robust domestic economic indicators, such as a 7.4% GDP growth in the January–March quarter, external factors and sector-specific weaknesses have overshadowed positive sentiments, leading to today’s market downturn.
For investors, it’s advisable to monitor global developments closely and consider a cautious approach in the short term. Consulting with financial advisors and focusing on long-term investment strategies may help navigate the current market volatility.