..... . VALI disclosures . .....: 09/01/26, SIX Reasons behind the Stock Market Falling Today

Friday, January 9, 2026

09/01/26, SIX Reasons behind the Stock Market Falling Today

(see our hand written report on 7/1/26...where we mentioned formed supports)

Benchmark indices extended their losses for a fifth consecutive session on Friday, January 9, as concerns over foreign fund outflows, geopolitical tensions and caution ahead of Q3 earnings kept investors on the sidelines.

The Sensex plunged more than 600 points, or nearly 0.80%, to an intraday low of 83,547, while the Nifty 50 fell 0.80% to 25,681. The BSE Midcap and Smallcap indices declined by over 1% each.

Over the past five sessions, the Sensex has shed more than 2,200 points, or 2.6%, while the Nifty 50 is down 2.5%.

Why is the Indian stock market falling?

1) Persistent FII selling

Foreign institutional investors have been net sellers of Indian equities since July last year. In January till the 8th, FIIs sold Indian stocks worth over ₹8,000 crore in the cash segment.

Foreign capital outflows were a key reason behind the market's modest returns in 2025. Experts warn that if the trend continues, domestic market gains could remain subdued in 2026 as well.

2) Caution ahead of US tariff ruling

The US Supreme Court is expected to deliver its verdict on Trump's "Liberation Day" tariffs on Friday, January 9.

A ruling against Trump would be seen as a relief for markets, while a verdict in his favour could further dampen sentiment by encouraging more aggressive tariff actions.

Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said the market will closely track whether the court partially strikes down the tariffs or declares them completely illegal.

"If the Supreme Court declares Trump tariffs illegal, there would be a rally in India since India has been the worst affected by the 50% tariffs," Vijayakumar said, adding that Thursday's sharp correction was triggered by fears of a possible 500% tariff under the Russia Sanctioning Act approved by Trump.

3) Renewed tariff concerns

Markets have weakened sharply after Trump hinted at raising tariffs on Indian goods over New Delhi's purchases of Russian crude. Over the past four sessions, the Sensex and Nifty have fallen 1.8% and 1.7%, respectively.

Trump has also approved a sanctions bill that could impose 500% tariffs on countries buying Russian oil. US Senator Lindsey Graham said the bill would give Trump "tremendous leverage against countries like China, India and Brazil" to stop purchasing cheap Russian oil.

"Persistent concerns over potential US tariff actions linked to India's Russian oil imports have kept sentiment fragile, while the lack of visible progress in US-India trade discussions is reinforcing institutional caution," said Ponmudi R, CEO of Enrich Money.

4) India-US trade deal uncertainty

Uncertainty surrounding the India-US trade agreement continues to weigh on sentiment. Despite multiple rounds of negotiations, the two countries have failed to finalise a deal, contrary to expectations that India would be among the first to conclude an agreement with the US.

Vinod Nair, Head of Research at Geojit Investments, said delays in the trade deal could prolong India's market underperformance.

5) Rising crude oil prices

Brent crude rose 0.53% to $62.32 a barrel. Higher oil prices increase India's import bill and inflation risks, which tend to pressure equity markets.

6) Rupee weakness

The rupee slipped 7 paise to 89.97 against the US dollar in early trade on Friday amid sustained FII outflows and higher crude prices. It opened at 88.88 at the interbank forex market before weakening further.

Forex traders said worries over possible US tariffs and weak domestic equities have led to continued foreign selling, putting pressure on the currency.

Technical outlook

Devarsh Vakil, Head of Prime Research at HDFC Securities, said the Nifty has broken key support levels.

"The Nifty breached crucial support at its 50-day exponential moving average at 25,911 and also violated the previous swing low of 25,878 on the daily chart. The next meaningful support is near 25,700, which coincides with the December 2025 swing low. On the upside, the 26,000-26,050 zone is likely to act as strong resistance in the near term," Vakil said.

source:News18

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Trade Cycles

The four important features of Trade Cycle are (i) Recovery, (ii) Boom, (iii) Recession, and (iv) Depression!

The trades cycle or business cycle are cyclical fluctuations of an economy. A full trade cycle has got four phases: (i) Recovery, (ii) Boom, (iii) Recession, and (iv) depression. The upward phase of a trade cycle or prosperity is divided into two stages—recovery and boom, and the downward phase of a trade cycle is also divided into two stages—recession and depression.

Phases of Trade Cycle:

The phases of trade cycle are explained with a diagram:

(1) Recovery:

In the early period of recovery, entrepreneurs increase the level of investment which in turn increases employment and income. Employment increases purchasing power and this leads to an increase in demand for consumer goods.

As a result, demand for goods will press upon their supply and it shall, thereby, lead to a rise in prices. The demand for consumer’s goods shall encourage the demand for producer’s goods.

The rise in prices shall depend upon the gestation period of investment. The longer the period of investment, the higher shall be the price rise. The rise of prices shall bring about a change in the distribution of income. Rent, wages, interest do not rise in the same proportion as prices.

Consequently, the margin of profit improves. The wholesale prices rise more than retail prices. The prices of raw materials rise more than the prices of semi-finished goods and the prices of semi-finished goods use more than the prices of finished goods.

(2) Boom:

The rate of investment increases still further. Owing to the spread of a wave of optimism in business, the level of production increases and the boom gathers momentum. More investment is possible only through credit creation. During a period of boom, the economy surpasses the level of full employment and enters a stage of over full employment.

(3) Recession:

The orders for raw materials are reduced on the onset of a recession. The rate of investment in producers’ goods industries and housing construction declines. Liquidity preference rises in society and owing to a contraction of money supply, the prices falls. A wave of pessimism spreads in business and those markets which were sometime before sellers markets become buyer’s markets now.

(4) Depression:

The main feature of a depression is a general fall in economic activity. Production, employment and income decline. The prices fall and the main factor responsible for it is, a fall in the purchasing power.

The distribution of national income changes. As the costs are rigid in nature, the margin of profit declines. Machines are not used to their full capacity in factories, because effective demand is much less. The prices of finished goods fall less than the prices of raw materials.

✳Reality Tips to Traders

1)Trading in the stock market is a marathon. 2)Protecting your capital is key. (Learn to protect first) 3)Making 0 on the day is better than losing 50k 4)Losses happen; they are part of this business. 5)It’s not you vs. the market. It’s you VS you. 6)You are your biggest enemy; learn to be mentally disciplined. 7)Don’t follow the majority; follow the correct path. 8)Traders without a stop loss end up not being traders for long. 9)There is always another trade. 10)The big money is made waiting for the right set-ups. 11)Waiting for the right trade is the most powerful strategy. 12)It is better to cut a loss than to wait to be proven right. 13)Position sizing can make or break you. 14)Worry about the downside before you even think about the upside. 15)Don’t listen to headlines

..BANKING TERMINOLOGY

There are various types of Banks: PSU Banks, Private Banks, Co-operative/Regional Banks, Small Finance Banks and Foreign Banks. When you deposit money in a bank, let's say the bank gives you an interest rate of 4%. But when the bank lends out this money, they lend it out at say, 12%. The difference of 8% in the above scenario is effectively the profit of the bank! The loans that do not pay interest for 90 days are known as Non-performing Assets. Banks have to provide for such bad loans. Structure of a Bank Asset for a Bank: The asset portion of a bank's capital includes cash, government securities, and interest-earning loans (e.g., mortgages, letters of credit, and inter-bank loans). Liabilities for a Bank: The bank's main liabilities are its capital (including cash reserves and, often, subordinated debt) and deposits. The latter may be from domestic or foreign sources (corporations and firms, private individuals, other banks, and even governments). Banks are required to maintain Liquidity with the Reserve Bank of India: SLR (Statutory Liquidity Ratio): It is the money a bank needs to preserve in the form of cash, gold or government Bonds before providing credit customers. This limitation is added by RBI on banks to make funds available to customers on-demand at your earliest convenience. Banks are required to maintain SLR at 18%. CRR (Cash Reserve Ratio): Banks are required to hold a certain proportion of their deposits in the form of cash. Banks don’t hold these as cash with themselves, but deposit such amounts with RBI / currency chests. CRR rate is at 4.5% currently. Repo Rate: The rate at which the RBI lends short-term money to the banks. The RBI through its Monetary Policy committee changes the repo rate to balance growth and Inflation. Reverse Repo rate: The rate at which banks park their short-term excess liquidity with the RBI. Now let us understand various terminologies for Banks Net Interest Income (NII): This is the spread the bank makes on its lending. It is calculated as Interest Income – Interest Expended Net Interest Margin (NIM): This is the spread the bank makes on its lending. It is the earning which is left after deducting the cost paid to depositors from its yields on Loans. This is denoted in % terms. The formula is Yield on Loans – Cost of funds Capital Adequacy Ratio (CAR): The capital adequacy ratio (CAR) is a measure of a bank's available capital expressed as a percentage of a bank's risk-weighted credit exposures. Essentially, it is the Capital that is available to lend. Tier I Capital – In simple words this capital is freely available with the bank to lend out. Tier II Capital- This is the capital tied up somewhere and is less freely available to lend. In case of an adverse event, the bank can use this capital to lend. Under Basel III norms, a bank’s tier 1+tier 2 capital must be a minimum of 8% of its risk-weighted holdings. The minimum capital adequacy ratio, also including the capital conservation buffer, is 10.5%. Current Account Saving Account (CASA)- There is no interest paid on the Current Account and a small interest rate is paid on a savings account. The combination of both is called CASA which shows the liabilities of the bank on which it pays relatively less interest. Deposits: Bank deposits are a savings product that customers can use to hold an amount of money at a bank for a specified length of time. In return, the financial institution will pay the customer the relevant amount of interest, based on how much they choose to deposit and for how long. Now let us come to NPA. Gross NPA (GNPA): It is the total loans on which no payment has been paid for 90 days or more. GNPA % is usually shown in each Bank’s quarterly results. The percentage is basically the GNPA amount as a % of the total advances. Slippages: Slippages denote the fresh amount of loans that have turned bad in a year. The slippage ratio of a bank is calculated as Fresh accretion of NPAs during the year /Total standard assets at the beginning of the year multiplied by 100. Provisioning Coverage Ratio (PCR): This is the ratio of provisioning to GNPA and indicates the extent of funds a bank has kept aside to cover loan losses. For Instance, a company has GNPAs of Rs 100 and they have set aside 50 Rs, then the PCR is 50%. Net NPA (NNPA): The total figure left after deducting provisions made for bad loans from GNPA. (GNPA – Provisions+upgrades/writeoffs = NNPA) Special Mention Account (SMA) SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days. SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of 30-60 days. SMA-2 is a category in which stress with respect to the principal and interest has remained overdue for a period of 60-90 days

..... . VALI disclosures . .....

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Friday, January 9, 2026

09/01/26, SIX Reasons behind the Stock Market Falling Today

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Today's

14/01/26, The Indian benchmark indices, SENSEX and NIFTY50, closed in negative territory on Wednesday, January 14, for the second consecutive session, amid selling in IT and realty stocks.

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