India's benchmark Nifty 50 index is moving back towards the 2025 low point hit in April, according to analysts at multinational brokerage CLSA. The 12-month low for the blue-chip index is 22,161 points. The Nifty ended at 23,002 on Thursday, after a 3.3% decline.
This week's test and failure below the former support zone at 23,700-23,800, now clearly acting as resistance, reinforces the March breakdown and places the market firmly back within the first quarter trading range between 21,777-21,800 support and 23,700-23,800 resistance, analysts led by Laurence Balanco said in a note.
"A move back towards the 2025 lows, which now looks increasingly likely, would negate the previously identified cup-and-handle formation and suggests the consolidation has evolved into a more complex, time-consuming pattern," they said.
The Nifty is down 8.6% so far this month and 12% year-to-date.
Indian equities witnessed a bloodbath on Thursday, snapping a three-day positive streak, as escalating tensions in West Asia triggered a global risk-off sentiment. The conflict has increasingly taken the shape of energy warfare, with attacks on critical infrastructure by both sides driving a sharp spike in crude oil prices and rattling investor confidence.
The Nifty 50 declined 775 points. Volatility surged sharply, with the India VIX rising 21.8% to 22.80, reflecting heightened uncertainty and a spike in risk aversion among investors.
The decline in the benchmark index were led by HDFC Bank Ltd. after its part-time chair Atanu Chakraborty resigned, citing concerns over practices that were not aligned with his personal values and ethics.
The fall was further exacerbated by persistent foreign outflows, with FIIs selling nearly Rs 74,000 crore over the past 12 sessions, adding to the pressure alongside weak global cues.
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