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News Topical, Digital Desk : The stock market declined for the second consecutive day on Friday. Heavy selling by foreign investors (FIIs) and weak signals from global markets dampened investor sentiment. The initial three-day rally was eventually wiped out in the last two days. The Sensex fell 466 points to close at 83,939, while the Nifty fell 156 points to 25,722. Banking, healthcare, and IT stocks were under pressure, while select PSU bank and defense stocks showed strength. The market breadth favored the downside, with the NSE's advance-decline ratio at 2:3.
The Sensex closed 466 points lower at 83,939, while the Nifty fell 156 points to 25,722. The Nifty Bank index fell 255 points to close at 57,776. The midcap index also declined by 270 points and closed at 59,826.
Top losers: Heavy fall in hospital, pharma and IT stocks - Eternal Ltd. was the biggest loser on Nifty on Friday and the stock fell by 3% after Swiggy's weak Q2 results. Max Healthcare fell by nearly 3% due to pricing reports putting pressure on healthcare sector stocks. Cipla reduced its margin outlook for FY26, due to which the stock continued to fall on Friday as well. Mphasis' results may have been stable, but the stock slipped by 5% due to not meeting market expectations. Bandhan Bank fell by 8% due to weak performance in Q2 and was among the worst performing stocks on Nifty.
Top Gainers: Navin Fluorine, Strides Pharma, BEL Shine - Navin Fluorine shares surged 15% as the company raised its guidance for FY26. Strides Pharma also surged 9%, buoying investors with its improved margin performance.
BEL (Bharat Electronics) surged 4% on the back of strong Q2 results, becoming the top Nifty gainer. Shriram Finance reported in-line results, rising 2%, while United Spirits (USL) remained in the green after a strong quarter, albeit slightly off its highs.
PSU Banks Shine - Public sector bank stocks saw strong gains. The market is buzzing over SEBI's new consultation paper, which may define new eligibility criteria for derivatives for non-benchmark indices. Analysts believe this change could benefit stocks like Union Bank, Indian Bank, and Yes Bank. Union Bank shares jumped 5%. Apart from this, speculations about a possible merger of Union Bank and Bank of India and discussions about increasing the FDI limit in PSUs from 20% to 49% also breathed life into the sector.
Why the market crashed: Three big reasons
1. Heavy FII Selling
Foreign investors sold shares worth ₹3,077.59 crore on Thursday, marking the second consecutive day of net selling. They had previously withdrawn ₹2,540 crore on Wednesday. Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments, said, "The renewed FII selling will keep the market under pressure for the time being."
2. Weak Global Cues
Weakness in Asian markets also impacted the domestic market. China's Shanghai Composite Index and Hong Kong's Hang Seng Index both ended in the red. US markets also closed in the red on Thursday. Enrich Money CEO Ponmudi R. said, "Asian markets also displayed a cautious tone on Friday following the fall in US markets. Investors are awaiting the Federal Reserve's latest policy and upcoming data."
3. Uncertainty over US-China trade deal
The meeting between US President Donald Trump and Chinese President Xi Jinping did not provide lasting relief to the markets. The two leaders met at a South Korean air base and agreed on a one-year "trade truce," but no comprehensive agreement was reached. According to Vijaykumar of Geojit Financial Services, "This deal provides only temporary relief, whereas the market was expecting long-term clarity."
What are the technical charts saying?
Anand James, Chief Market Strategist at Geojit Financial Services, said, "The pattern that looked bullish earlier is now turning into a topping formation." According to him, the support zone for Nifty is between 25,700–25,400, while resistance is seen around 25,960. If Nifty stays above this level, the decline may be averted, otherwise further weakness is possible.
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