Why Sensex, small and mid cap stocks fell today: 5 reasons

Photos: Pixabay/Pexels

Written By: Rajeev Kumar

BSE Sensex plunged around 800 points today to the day's low of 72,300 while Nifty50 gave up its hold on 22,000 level.

The fall was steeper in midcap, small cap and microcap indices as they fell around 2%.

It is estimated that investors were left poorer by around Rs 6 lakh crore in market capitalisation!

Let's look at the top 5 reasons that led to this fall today

1. SEBI has asked mutual fund houses to disclose more about risks in the small and mid cap space to investors.

2. The hopes of a rate cut in the US is fading. Traders continue to wait for release of US Personal Consumption Expenditure Price Index (PCE) Data for January.

3. Monthly F&O expiry is tomorrow. This is also believed to be the reason behind today's volatility.

4. Some major global markets also witnessed a decline today. MSCI was down 0.44%, Nikkei 0.3%, Hang Seng 1.4% and Shanghai Composite 1.9%.

5. Higher valuations are giving little comfort to investors. Moreover, higher valuations seem to be supportive of the case for profit booking.

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