Stock market crash: Sensex, Nifty log longest monthly losing streak in 29 years; What should investors do now?

Stock market crash: Domestic equity benchmarks Sensex and Nifty 50 logged their worst day in around five months on Friday, with Nifty 50 posting its longest monthly losing streak since 1996 on pessimism over domestic market conditions. The benchmark Nifty 50 and the BSE Sensex closed 1.9% lower at 22,124.70 and 73,198.10, respectively. They are down 6% for the month.

Ajit Mishra – SVP, Research, Religare Broking Ltd said, “The new expiry series began on a weak note, with markets slipping nearly two percent, weighed down by weak global cues. The bearish sentiment was evident from the start and intensified as the session progressed, pushing Nifty to close near the day’s low at 22,120. The decline was broad-based, with IT, auto, and FMCG leading the losses, while the broader indices also followed a similar trend.

Uncertainty often weighs more than the actual event, and the market is currently grappling with concerns over potential trade wars. Additionally, persistent FII selling continues to add pressure. On a technical front, after five consecutive months of decline, Nifty has approached the crucial support zone of 21,800-22,000, where multiple key indicators align.

Given the prevailing weakness, traders should maintain a cautious stance with a negative bias until clear signs of a pause or reversal emerge. It is also advisable to manage leverage carefully and prioritize hedged trades for risk management.”