Markets Slide as Powell’s Valuation Warning Rattles Sentiment

Markets Tumble as Powell’s Valuation Warning Shakes Investor Confidence

Written by: Supriya Kadu

Edited by: Pinky Deshmukh

Last Updated: September 24, 2025

Summary: In early trading, the Sensex and Nifty dropped after Powell cautioned about market overvaluation.

Indian markets opened on shaky ground this Wednesday, with the Sensex down about 275 points and the Nifty falling nearly 85 points. A strong tone of caution swept across many sectors after Federal Reserve Chair Jerome Powell flagged concerns about lofty asset valuations.

What Spooked Investors

Valuation Concerns from Powell

Powell recently cautioned that equity markets are “fairly highly valued,” which put global sentiment on edge. His remarks reminded investors that no matter how strong the momentum is, risks remain if prices outrun fundamentals.

Broad Sector Weakness

The tech/IT sector took the heaviest hit, slipping around 0.7%. Auto, metals, realty, and FMCG also saw low pressure. Only PSU banks showed some strength, edging higher.

Negative Global Cues

Powell’s words echoed in global markets. Equity indexes abroad fell from earlier gains as traders digested the possibility that central banks may not ease policy as quickly as hoped.

Technical & Strategic Takeaways

Market analysts say momentum is losing steam. On the charts, the Nifty is facing resistance around 25,278, and support zones near 24,880-24,800 are now under focus. Until we see a clean breakout or breakdown, market direction may remain murky.

Some strategists warn that, absent fresh positive triggers—like strong earnings or a dovish Fed turn—markets may stay in a sideways or choppy mode for a while.