Last Updated:
Why stock market is falling today? Know reason behind sensex, nifty trading with deep cuts on May 22
Stock Market Crash
Why Is Market Falling Today: Domestic stock markets opened sharply lower on Wednesday, with benchmark indices plunging amid weak global cues and growing concerns over the US economy. The sharp sell-off erased the previous session’s gains, signaling renewed investor caution.
At its intraday low, the BSE Sensex plunged 1,000 points, or 1.23%, to 80,595, while the Nifty50 slipped 270 points, or 1.09%, to 24,543 around 12:55 PM.
The heightened market volatility weighed heavily on broader indices, exerting significant pressure on both small- and mid-cap stocks.
Shares of Reliance Industries led the losses, falling 1.5% to Rs 1,406 on the BSE. Among sectoral indices, Nifty Auto, FMCG, IT, Pharma, Consumer Durables, and Oil & Gas declined between 1% and 1.5%.
Nifty Bank and Financials also slipped up to 0.7%. In the broader market, the Nifty Midcap was down 0.5%, while the Nifty Smallcap edged 0.2% lower.
The total market capitalisation of all listed companies on the BSE fell by Rs 2.6 lakh crore.
Here’s a rewritten version of your piece in a more cohesive and polished style:
Why Are Markets Falling on May 22?
Spike in US Treasury Yields
Global markets, including India, are under pressure as U.S. Treasury yields surge. The yield on 30-year Treasuries held above 5% during Asian trading hours, its highest level in nearly 18 months. Rising yields typically pull capital away from riskier assets such as equities, especially in emerging markets.
US Fiscal Worries Intensify After Moody’s Downgrade
Investor sentiment remains fragile following Moody’s downgrade of the US credit rating last week, citing mounting debt concerns. The rating agency flagged the unsustainable trajectory of the U.S. fiscal deficit as a key risk. Adding to these concerns is a proposed tax bill under discussion, which could increase US debt by $3.8 trillion, pushing the total past $36 trillion.
“The fundamental issue is the high fiscal deficit of the US, which the market feels is unsustainable,” said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Weak Demand for US Bonds
A lackluster response to a $16 billion auction of 20-year U.S. bonds further spooked markets. The soft demand drove yields even higher, signaling weakening investor confidence in U.S. government debt.
“The weak US 20-year bond auction and the spike in yields of 5-, 10-, and 30-year bonds indicate declining confidence in US bonds,” Vijayakumar added.
Asian equities followed Wall Street lower. MSCI’s index of Asia-Pacific shares (excluding Japan) was down 0.5%, Japan’s Nikkei slipped 0.7% as the yen strengthened, and Hong Kong’s Hang Seng dropped 0.8%. China’s benchmark also declined 0.2%.
Overnight in the U.S., the Dow fell 1.9%, the S&P 500 lost 1.6%, and the Nasdaq shed 1.4% amid rising rate worries.
Technical Outlook: Markets on Edge
According to Prashanth Tapse, Senior VP (Research) at Mehta Equities, Thursday may see bears regaining control, triggered by global headwinds, renewed Covid-19 anxieties, and overbought technical signals. “The intraday bias remains neutral to negative below the 25,000 mark, with key support at 24,386,” he said.
Akshay Chinchalkar, Head of Research at Axis Securities, noted that Tuesday’s price pattern showed a long upper shadow, typically a warning sign for bulls. “The market is just clinging to a rising trendline from April’s lows. Bulls need to reclaim the 25,000 mark quickly for momentum to sustain. Key support is at 24,610, with resistance in the 25,000–25,340 zone,” he explained. He also identified May 28–30 as a critical time window for potential market moves based on time-cycle analysis.
- First Published: