Markets: Sensex posts worst start to a year in a decade as foreign selling and global uncertainty weigh on sentiment
Indian equities logged their weakest opening stretch to a calendar year in about a decade, with the Sensex down around 1.93% between 1 and 10 January 2026. Analysts attributed the slide to geopolitical risks, trade uncertainty and sustained foreign institutional selling, even as domestic institutions bought aggressively. The sell-off was broad-based, hitting cyclical sectors harder and reviving questions about volatility in early 2026.
- Reporting desk
- Health India Network News Desk
- First published
India’s equity benchmarks began 2026 on an unusually weak note, with the BSE Sensex falling about 1.93% between 1 January and 10 January—its worst opening stretch to a calendar year in roughly a decade. Market participants pointed to a combination of global shocks and domestic caution, with geopolitics and trade-related uncertainty feeding risk aversion across large caps as well as the broader market.
The downturn accelerated in the first full trading week of the year. For the week ended 9 January, the Sensex dropped around 2.55% to close near 83,576, while the Nifty 50 fell roughly 2.45% to about 25,683. Midcap and smallcap indices declined even more, signalling that investors were cutting exposure beyond the frontline names and that the selloff was not limited to a narrow pocket.
Foreign institutional investors remained central to the narrative. Data cited in the report said FIIs sold Indian equities worth about ₹8,808 crore during the week, even as domestic institutional investors bought shares worth roughly ₹15,700 crore. Despite the domestic bid, the index declines suggested that sentiment was fragile and that the market was reacting sharply to global developments and headline risk.
Analysts linked the pressure to heightened geopolitical uncertainty and to jitters around trade outcomes, including concerns that external policy shifts could translate into tariffs or broader financial tightening. The report also noted that expectations of mixed quarterly earnings and the continuation of foreign selling added to the negative mood at the start of the year.
Sectorally, the selling was described as broad-based but more pronounced in cyclical and policy-sensitive areas. Oil and gas, energy and infrastructure stocks saw steeper cuts during the pullback, while some defensive pockets held up relatively better as investors sought perceived safety. Strategists quoted in the report advised caution, arguing that the near-term trend would depend on whether benchmarks reclaim key levels amid continued volatility.