Overview of Market

1 Markets Tumble Amid Global Uncertainty

Indian markets witnessed a sharp sell-off on June 12, 2025, with the Nifty plunging nearly 300 points to close at 24,800, breaking the crucial 25,000 mark. The sell-off was triggered by a combination of global and domestic factors. Tensions between the US and Iran pushed Brent crude prices up by 5% to $70 per barrel. Additionally, a grave recession warning from the US Treasury Secretary — suggesting risks worse than the 2008 financial crisis — shook investor sentiment worldwide. On the institutional side, Foreign Institutional Investors (FIIs) offloaded ₹3,831 crore worth of equities, while Domestic Institutional Investors (DIIs) bought ₹9,393 crore, but it wasn’t enough to contain the fall.

️ 2 Breakdown Signals Weakness

From a technical perspective, the markets witnessed a clear breakdown from the flag pattern, with the Nifty closing below its uptrend line drawn from April 7, 2025. This move invalidated the bullish setup seen in recent weeks. The immediate support now lies at 24,500 — a breach of which could open the downside towards 24,000. Technical indicators reflected the weakness, with RSI slipping to 55, showing a bearish divergence, while Stochastic Oscillator at 53 indicates there’s still room for further correction before reaching oversold territory.

3 Global Cues Overpower Local Positives

Global events continued to weigh heavily on market sentiment. The US-China trade deal outcome disappointed investors, offering only a 10% tariff relief with weak future commitments. Meanwhile, the UK economy shrank by 0.3%, as exports to the US declined sharply. In currency and commodity markets, the Dollar Index crashed to 97.9 — a 52-week low, which sparked a rush towards safe-haven assets like gold, which surged to ₹3,383 per 10 grams (+0.8%).

4 India’s Mixed Data Fails to Soothe Nerves

On the domestic front, data presented a mixed bag. CPI inflation eased to 2.82%, a 34-bps decline, which typically would have been a positive for markets. However, the bearish global environment overshadowed this. Moreover, AMFI data revealed equity mutual fund inflows at a 13-month low, even though SIP contributions hit record highs — indicating cautious investor behavior. Sectorally, there was a broad-based sell-off, with Realty, Banks, and FMCG sectors leading the decline, and not a single sector closing in the green.

5 Key Levels & Events to Track Ahead

Going forward, all eyes will be on the 24,500 support level for the Nifty. A decisive breach could trigger a fresh wave of selling towards 24,000. Globally, investors await the Federal Reserve meeting next week, with speculation rife whether President Trump will pressure Fed Chair Powell for a rate cut amidst economic slowdown concerns. Geopolitical risks, particularly in the Middle East, remain elevated, with a real possibility of crude oil prices shooting past $100 per barrel if tensions escalate further. In this uncertain scenario, a defensive market stance is advisable, with a focus on IT, Pharma, and Gold as safe investment avenues.