Sensex and Nifty slide over 4% in January as foreign selling and rupee weakness weigh on sentiment
Indian equities remained under pressure through January 2026, with benchmark indices down more than 4% amid sustained foreign outflows, a weak rupee, muted earnings, and global risk-off cues ahead of the Union Budget.
Indian benchmark indices extended a soft run in January 2026, with the BSE Sensex and NSE Nifty down over 4% during the month as investors grappled with persistent foreign portfolio selling, rupee weakness, and a cautious earnings backdrop. Market participants also cited geopolitical tensions and renewed tariff-related concerns globally as factors feeding a risk-off mood. ([timesofindia.indiatimes.com](https://timesofindia.indiatimes.com/business/india-business/sensex-nifty-slide-over-4-in-january-amid-fpi-sell-off-rupee-weakness-and-global-risks/articleshow/127540749.cms))
What is driving the January slide
According to the report, FPIs accelerated selling during the month, adding pressure on the currency and overall sentiment. Analysts also pointed to elevated crude prices and higher global bond yields as amplifiers of risk aversion, while mixed commentary from some large corporates dampened confidence in a quick rebound. ([timesofindia.indiatimes.com](https://timesofindia.indiatimes.com/business/india-business/sensex-nifty-slide-over-4-in-january-amid-fpi-sell-off-rupee-weakness-and-global-risks/articleshow/127540749.cms))
Attention is now turning to policy signals ahead of the Union Budget 2026–27, with expectations that the government will balance growth support with fiscal prudence. Historically, traders watch for pre-Budget volatility and any post-Republic Day stabilisation, but the report notes that investors will be looking for clearer triggers this time. ([timesofindia.indiatimes.com](https://timesofindia.indiatimes.com/business/india-business/sensex-nifty-slide-over-4-in-january-amid-fpi-sell-off-rupee-weakness-and-global-risks/articleshow/127540749.cms))
- January 2026 performance: Sensex and Nifty down 4%+ (month-to-date in the report)
- Key headwinds: FPI selling, rupee weakness, earnings disappointment, global uncertainty
- Next focus: Union Budget 2026–27 expectations and policy cues
With volatility elevated, analysts flagged that near-term moves may react to global headlines, but sustained direction is likely to depend on domestic macro conditions and earnings momentum as India heads into the Budget season. ([timesofindia.indiatimes.com](https://timesofindia.indiatimes.com/business/india-business/sensex-nifty-slide-over-4-in-january-amid-fpi-sell-off-rupee-weakness-and-global-risks/articleshow/127540749.cms))