The Indian stock market slipped further into the red as selling extended to the fifth consecutive trading session on Friday, January 9, with the Nifty 50 falling 0.80% to the day’s low of 25,665. Over five days, the index has cumulatively lost 663 points, or 2.5%, setting up its worst weekly decline in more than three months.
Investor confidence in Asia’s third-largest economy took a hit amid fears of fresh US tariffs on Indian imports, escalating geopolitical tensions, and renewed bouts of FPI selling, causing local equities to underperform their Asian peers in early January.
Although Indian equities began the year on a firm note, with the Nifty 50 scaling a fresh record high of 26,273, optimism quickly faded following US military attacks on Venezuela, which heightened geopolitical tensions, and warnings from US President Donald Trump about potential tariff hikes on India.
Fresh tariff warnings spark 8,300 crore FPI sell-off
Earlier this week, Trump warned of higher tariffs on Indian exports if India does not halt purchases of Russian oil. A bipartisan US bill proposing tariffs of up to 500% on countries buying Russian oil has received Trump’s backing and awaits congressional approval.
The US had already imposed an initial 25% tariff, followed by an additional 25% tariff on India due to Russian oil purchases, which Washington sees as helping to fund Russia’s war in Ukraine. The fresh warnings appear to have dampened market sentiment further, as they could delay a trade agreement between the two countries.
India and the US have had multiple rounds of trade negotiations but have not yet reached an agreement. The delay also caused FPIs to remain net sellers in the Indian market for the majority of 2025, withdrawing a record. 1.66 lakh crore, according to NSDL data.
The FPI sell-off extended into 2026, with foreign investors remaining net sellers in five of the first six trading sessions, taking₹8,305 crore from the secondary market”> another 8,305 crore from the secondary market.
january blues
Historically, January has been a weak month for the Indian stock market, with the Nifty 50 closing lower in each of the past five years.
January is also generally a busy month for the market, with companies rolling out business updates alongside their December quarter results, keeping sentiment cautious.
Markets await US Supreme Court verdict on tariffs
All eyes are on the US Supreme Court today as it prepares to rule on tariffs imposed by US President Donald Trump on the country’s trade partners. The top court is expected to issue its order on Friday, having scheduled January 9 as an “opinion day,” which marks the first opportunity for a ruling on the Trump tariffs.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, “There is a high probability of the verdict going against Trump. But the details are significant: that is, whether it would be a partial striking down of the tariffs or a complete declaration of the tariffs illegal. The market reaction would depend on the details. 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.”
“In the sharp market pull back this week even stocks which will not be impacted by any draconian action by Trump have been affected. Segments like financials, consumer discretionary and industrials that have corrected due to the overall market weakness can be accumulated now for long-term investment,” he further stated.
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