Indian equities went into a steep decline on Monday, sparking widespread panic among investors as nearly ₹7.31 lakh crore in market value evaporated on the BSE. The brutal selloff came as foreign institutional investors (FIIs) pulled out heavily, while traders remained on edge ahead of the crucial US Federal Reserve announcement.
Dalal Street Turns Red as Markets Face Heavy Sell-Off
It was a brutal day for Indian equities as the BSE Sensex slipped 609.68 points (0.71%) to close at 85,102.69, after briefly crashing more than 800 points during intraday trade. The Nifty 50 also fell sharply, dropping 225.90 points (0.86%) and sliding below the crucial 26,000 mark to end at 25,960.55.
The pain was even worse in the broader market. Midcap stocks plunged 1.73%, while smallcaps nosedived 2.20%, leaving retail investors nursing heavy losses. Meanwhile, the India VIX surged 7%, signaling a sudden spike in market fear and volatility.
IndiGo Takes a Hard Fall as Market Sell-Off Deepens
A major highlight of the day’s chaos was IndiGo’s sharp 8.62% plunge, with the stock slipping to ₹4,907.50. The airline’s market cap dropped to ₹1.90 lakh crore, dragged down by more than 650 flight cancellations and a stern DGCA show-cause notice. With this, IndiGo’s losing streak has now stretched to seven consecutive sessions, adding up to a painful 13.5% monthly decline.
The broader market weakness wasn’t limited to aviation. Heavyweights like BEL (-5%), JSW Steel (-4%), and HAL (-3.61%) also faced strong selling pressure. Sector-wise, realty stocks nosedived 3.5%, while media, PSU banks, and telecom stocks all slipped more than 2.5%, intensifying the market-wide rout.
FIIs Go on a Selling Spree as Global Uncertainty Mounts
Foreign investors continued their aggressive exit from Indian equities, offloading a massive ₹12,055 crore in just the first week of December. With this, total FII outflows for 2025 have ballooned to ₹1.55 lakh crore, adding pressure on an already fragile market. The rupee slipped to ₹90.11 per dollar, giving back the brief optimism seen after the RBI’s rate cut.
Friday’s gains were quickly wiped out as investors booked profits ahead of a crucial week. Now, all eyes are fixed on Wednesday’s US Federal Reserve decision, where rates are widely expected to land in the 3–3.25% range, despite the Fed’s consistently hawkish signals. Technically, the Nifty is inching toward its 21-day EMA, raising concerns of deeper corrections if global cues worsen.
Even brokerages are divided on key stocks. Investec has a bearish view on IndiGo with a target of ₹4,040, while UBS remains optimistic at ₹7,025. For now, the mood across the market is clear—caution first. Traders are advised to consult financial professionals before making any high-risk moves.