Why is the Core Lithium share price sinking 9% today?

The Core Lithium Ltd (ASX: CXO) share price is deep in the red on Wednesday despite no announcements from the company.

At market open, the lithium producer's shares were hovering in positive territory before plummeting to an intraday low of $1.065 a share.

Currently, the Core Lithium share price is $1.085, down 8.82%.

Let's take a look at what could be driving the fall in the company's share price.

Core Lithium shares retreat

Investors are selling off Core Lithium shares amid a mixed session across the ASX Indices.

With the S&P/ASX 200 Materials Index (ASX: XMJ) edging 0.72% lower at the time of writing, a number of lithium companies are struggling.

Shares in Liontown Resources Ltd (ASX: LTR) and Allkem Ltd (ASX: AKE) are down 3.3% and 2.86%, respectively.

One reason for the Core Lithium share price tanking more than its peers might be that investors are taking profit.

According to reports from The Australian Financial Review, 46.4 million Core Lithium shares were transferred in a trade handled by Petra Capital. It is believed the transaction was carried out at $1.05 per share, representing a 14% discount from yesterday's closing price.

The company's shares have risen 175% in a year, and are up 85% in 2022.

Since the start of the month, before its abrupt fall on 13 September, Core Lithium shares rocketed by more than 30%.

The company released a business update to shareholders yesterday, noting that first production at its Finniss Lithium Project isn't far away.

In addition, management advised it is following the footsteps of peer Pilbara Minerals Ltd (ASX: PLS). This will see Core Lithium auction off its first direct ship ore spodumene shipment from Finniss before the end of 2022.

However, shareholders didn't seem too fazed about the update, sending Core Lithium shares 8.7% lower yesterday.

Core Lithium share price snapshot

Adding to today's fall, the Core Lithium share price has tumbled more than 24% in a week.

Based on today's price, Core Lithium commands a market capitalisation of approximately $1.9 billion.