Why is the Share Market Falling on May 22, 2025? Sensex Falls 869 Points and Nifty Drops Below 24,550 

The Indian stock market, including benchmark indices Sensex and Nifty, experienced a sharp decline on Thursday, May 22, 2025. This drop was primarily influenced by weak global market cues and renewed worries about the fiscal health of the United States.

Stock Market Performance on May 22, 2025

The BSE Sensex fell by 869.52 points or 1.06%, settling at 80,727.11 points. Similarly, the NSE Nifty50 declined by 361.85 points or 1.09%, closing at 24,541.60 points. Broader markets also faced losses; by 11:30 AM, the Nifty SmallCap 100 index was down by 0.40%, while the Nifty MidCap 100 index slipped by 0.68%.

Top Reasons Behind the Market Fall

1. Weak Global Cues

Markets in the Asia-Pacific region fell on Thursday, mirroring overnight losses on Wall Street. Investors were cautious due to growing concerns over the mounting US fiscal problems.

Japan’s Nikkei index was down over 0.7%, the Topix index declined by 0.5%, South Korea’s Kospi dropped 1.1%, and Australia’s ASX 200 was lower by 0.4%.

On Wall Street, all three major indexes closed in the red. Investors reacted negatively to a sharp rise in Treasury yields, triggered by concerns that a new US budget bill would worsen the country’s already high fiscal deficit.

The Dow Jones Industrial Average lost 1.91% to close at 41,860.44, the S&P 500 dropped 1.61% to 5,844.61, and the Nasdaq Composite fell 1.41% to 18,872.64.

The 30-year US Treasury bond yield traded near 5.09%, its highest since October 2023. The 10-year Treasury yield was at 4.59%.

2. US Debt Worries

Gita Gopinath, the First Deputy Managing Director of the International Monetary Fund (IMF), warned that the United States is running very large fiscal deficits and urgently needs to tackle its growing debt burden. Her comments were published in an interview with the Financial Times on Wednesday.

These remarks came soon after Moody’s downgraded the US sovereign credit rating. The downgrade cited the federal government’s inability to control its massive $36 trillion debt and persistent high deficits.

3. Most Sectors Ended in the Red

All sectoral indices, except for Nifty Medi, traded lower.

Nifty Auto was the biggest loser among sectors, falling 1.4%, followed by Nifty FMCG which declined 1.27%, and Nifty IT, which dropped 1.11%.

Other sectors such as Pharma, PSU Banks, Private Banks, Consumer Durables, and Oil & Gas also posted losses ranging from 0.5% to 1%.

Also Read: IndusInd Bank to Realign Senior Management Roles After Accounting Review! 

Conclusion

The sharp fall in the Sensex and Nifty on May 22, 2025, was primarily caused by weak global market conditions and increasing concerns about the US fiscal health. Rising Treasury yields and a credit rating downgrade of the US added to investor caution worldwide. Most sectors in India closed in the red, reflecting a broad market downturn. 

By staying informed about these global and domestic factors, investors can better understand market volatility and plan their investment strategies accordingly.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.                  

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.