Sensex, Nifty today: Why stock market is falling, yet outperforming Korea, Japan shares

Sensex, Nifty, stock market today: A sharp unwinding of the AI trade across the US, South Korea and Taiwan, coupled with rising US bond yields and stronger-than-expected jobs data that fuelled expectations of a Fed rate hike, sent Asian stocks tumbling. A rise in crude oil prices amid the intensifying of West Asia war hurt sentiment globally. India, a non-AI trade, was better off compared with global peers that have seen a dream $12 trillion rally this year on chip demand. 

At 9.21 am, the BSE Sensex was quoting at  73,502.20, down 741.14 points or 1 per cent. Nifty was quoting at 23,127.95, down 238.75 points or 1.02 per cent. In comparison, Asian markets fell up to 8 per cent, with Korea's Kospi and Japanese Nikkei leading the fall. 

"The domestic market has shown resilience post the weak start, with the Nifty recovering steadily from lower levels, supported by buying interest in the Pharma and IT sectors," said SBI Securities. The brokerage said the zone of 23,060-23,040 will act as a crucial support for Nifty while the resistance lies in the zone of 23,300-23,340.  

Wall Street selloff Dow Jones Industrial Average fell 1.35 per cent to 50,866.78, while S&P500 plunged 2.64 per cent to 7,383.74. The biggest fall was observed on Nasdaq Composite, with declined 4.18 per cent to 25,709.43, led by semiconductor stocks such as Intel, Advanced Micro Devices Inc, Broadcom and Marvell Technology. 

Asian markets take hit

VK Vijayakumar, Chief Investment Strategist at Geojit Investments said there are strong headwinds for the market as trading begins for the week. "The sharp cut of 4.18 per cent in Nasdaq last Friday has rattled global markets with tech dominated South Korea and Taiwan facing big sell-off," it said. Korea's Kospi plunged as much as 8 per cent earlier today, but recovered. It was still down over 4 per cent. Japan's Nikkei fell 3.7 per cent. Hong Kong and Chinese mainland indices were down 1.3 per cent eracg. 

Iran-Israel war The market was concerned as Iran and Israel hit each other for first time since ceasefire, intensifying the West Asia war. Reuters reported that Israel struck military targets in western and central Iran on Monday, even after the US President ​Donald Trump reportedly told Israeli Prime Minister Benjamin Netanyahu to refrain from further attacks.

Crude oil prices This was enough to send crude oil prices soaring 4 per cent in Monday's trade. Brent futures for August delivery was trading at $96.36 a barrel, up 3.54 per cent. This was in addition to 2.55 per cent gain the previous session.

The escalation of conflict in West Asia, with Iran firing missiles at Israel in retaliation to Israel’s aggression in Lebanon, has hardened crude prices. 

US bond yields

The stronger-than-expected US jobs data has reignited concerns that the Federal Reserve could maintain a hawkish stance for longer, resulting in higher bond yields and renewed risk aversion across global equities, said Rajesh Palviya, Head of Research at Axis Direct.

"The jobs data from the US is good, and therefore, the Fed will not cut rates as President Trump wants. The rates are likely to be on hold for some time,"  Vijayakumar said.

How did India outperform Asian peers?

Vijayakumar said the sell-off in US on Friday was tech-led. This can trigger a rotation from AI trade to non-AI trade which can be beneficial for India, he said.

"Rupee appreciating to 94.94 level from the recent low of 96.96 is likely to deter the FIIs from sustained selling in India. GDP growth for FY26 coming at 7.7 per cent and the better-than-expected Q4 results can provide fundamental support to the market," he said.