Sensex today cracks nearly 1,000 points: Here are 5 reasons why market is falling - Explained

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midcap and smallcap indices also falling over a percent each. All the sectoral indices were trading in the red with banks, auto and metals falling the most. Tata Motors, Hero MotoCorp, Tata Steel, Coal India were among the top losers on the Nifty today.

Here are key reasons behind the selling in the Indian stock market today. Market came under selling pressure primarily amid global risk off sentiment triggered after the rating agency Fitch cut the United States’ top credit rating. The credit rating agency downgraded the United States' Long-Term Foreign-Currency Issuer Default Rating (IDR) to AA+ from AAA, citing expected fiscal deterioration over the next three years.

“In Fitch's view, there has been a steady deterioration in standards of governance over the last 20 years, including on fiscal and debt matters, notwithstanding the June bipartisan agreement to suspend the debt limit until January 2025," Fitch said in a statement. The move led to a selloff in risky assets with investors taking shelter in safe-haven investments. Read here: Explained: What is a rating downgrade? And six key reasons why Fitch Ratings downgraded US “The downgrade of the US credit rating by a notch is sentiment negative for global markets.

The US 10-year bond yield spiking above 4% and the dollar index rising to 102 are near-term negative for emerging markets," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. However, Vijayakumar noted that the downgrade did not say anything that the market did not know. So, he believes the negative knee jerk reaction will be short lived.

“Globally equity markets have been rising on the US economy’s soft landing narrative. The downgrade doesn’t alter that," he added. Santosh