Indian benchmark indices gave up a significant portion of their early gains on June 9, with the Sensex falling more than 400 points from its intraday high and the Nifty slipping towards the 23,150 mark. The pullback came amid persistent foreign institutional investor (FII) selling, renewed concerns over economic growth, and heightened volatility associated with the weekly derivatives expiry.
The market opened on a strong note, supported by selective buying across heavyweight stocks. The Sensex climbed over 500 points in early trade, while the Nifty advanced more than 130 points. However, optimism faded as the session progressed, triggering profit-booking at higher levels and leading investors to adopt a more cautious stance.
By mid-morning, the Sensex had pared most of its gains and was trading only marginally higher, while the Nifty hovered around the 23,150 level.
One of the primary factors behind the market’s reversal was continued selling by foreign investors. According to provisional data, FIIs sold equities worth over ₹5,500 crore in the previous session. Foreign portfolio investors have withdrawn nearly ₹43,000 crore from Indian equities during the first week of June alone, extending a broader trend of capital outflows that has dominated 2026. Total FPI outflows this year have already crossed ₹2.67 lakh crore, significantly exceeding the amount withdrawn during the entirety of 2025.
Investor sentiment was also impacted by Fitch Ratings’ decision to lower India’s FY27 GDP growth forecast to 6.4 percent from its earlier estimate of 6.7 percent. The agency cited the economic impact of the ongoing US-Iran conflict, rising commodity prices, and pressure on consumer spending as key reasons behind the downgrade. The revision follows the Reserve Bank of India’s recent move to lower its own growth projection while simultaneously raising its inflation outlook.
Geopolitical developments added another layer of uncertainty. Reports of a US Army Apache attack helicopter crash near the Strait of Hormuz renewed concerns about escalating tensions in West Asia. While the cause of the incident remains under investigation, markets remain highly sensitive to any developments that could threaten global energy supplies or push crude oil prices higher.
The weekly expiry of Nifty derivatives contracts further amplified volatility. Expiry sessions typically witness position adjustments, rollovers, and short-covering activity, often resulting in sharp intraday swings. Market participants also pointed to the sizeable short positions held by foreign investors, which continue to influence sentiment and trading behaviour.
From a technical perspective, analysts believe the market remains vulnerable to further weakness unless key resistance levels are decisively breached. While support is seen near the 23,000 zone, sustained buying interest will be required to restore bullish momentum and stabilise the broader market trend.
Despite the intraday decline, market experts suggest that investors remain focused on a combination of global geopolitical developments, foreign fund flows, inflation trends, and economic growth forecasts, all of which are expected to determine the market’s direction in the coming weeks.
For now, caution continues to outweigh conviction as traders navigate an environment marked by elevated volatility and persistent uncertainty.
Kaashika is a social media strategist and financial content creator at Lakshmishree. She specialises in simplifying complex IPO and stock market concepts into clear, easy-to-understand content. Having created over 500+ pieces of financial content across reels, blogs, website posts and digital creatives, Kaashika helps audiences connect with the world of finance in a more accessible and engaging way.
