Indian equity markets came under renewed selling pressure on Thursday, with the Sensex falling more than 500 points and the Nifty 50 slipping below the 24,100 mark. The decline came despite a firm opening and positive cues from global markets, as weakness in heavyweight stocks and expiry-day volatility pulled the benchmarks lower.
The BSE Sensex fell 539.35 points, or 0.70%, to close at 76,933.59, while the NSE Nifty 50 declined 116.90 points, or 0.48%, to settle at 24,090.85. The market began the day on a stronger note, but gains faded as selling intensified through the session.
The Nifty initially moved above 24,200, while the Sensex gained more than 100 points in early trade. Investors took some comfort from easing crude oil prices and gains across several Asian markets. A positive outlook from US chipmaker Nvidia also lifted sentiment around technology and artificial intelligence stocks globally.
However, domestic factors soon took centre stage. Thursday also marked the monthly derivatives expiry, which added to intraday swings. Selling gathered pace in the second half of the session, leaving both benchmarks close to their day’s lower levels.
Among the top gainers, Adani Enterprises emerged as one of the strongest performers on the Nifty, while Kotak Mahindra Bank also advanced around 1.7%. Adani Ports, Bharat Electronics and Cipla were among other notable stocks that finished higher.
Adani Enterprises’ gain provided some support to the benchmark, but it was not enough to offset declines in several large-cap stocks. Kotak Mahindra Bank also stood out among financial stocks as investors picked up select banking counters despite broader weakness in the sector.
On the losing side, Hindalco Industries was among the biggest Nifty laggards. HDFC Bank also remained under pressure, falling around 2.2% and touching its lowest level in nearly two-and-a-half years. Mahindra & Mahindra, HCL Technologies and Shriram Finance were among the other prominent losers.
HDFC Bank’s decline became a major drag on the Sensex and Nifty because of the stock’s heavy index weight. The lender has been facing investor concerns following reports of a proposed US securities class-action lawsuit involving the bank and two senior executives over alleged illegal payments linked to the Maharashtra State Road Development Corporation. HDFC Bank has rejected the allegations and said it would defend itself.
Uncertainty surrounding the future leadership of HDFC Bank has added to the pressure. Investors are also watching developments around CEO Sashidhar Jagdishan, whose current term is scheduled to end in October. The combination of legal concerns and leadership uncertainty has made the bank a closely watched stock in recent sessions.
The weakness was not limited to a few heavyweight companies. Market breadth remained negative, with more than 2,300 stocks ending lower against around 1,700 gainers. The Nifty Midcap and Smallcap indices also closed marginally lower, indicating that cautious sentiment extended beyond the large-cap segment.
Sector-wise, metals, automobiles, oil and gas, FMCG and parts of the financial sector faced selling. Hindalco’s decline weighed on the metal index, while Mahindra & Mahindra contributed to pressure on auto stocks. Technology shares such as HCL Technologies also ended lower.
Pharmaceutical and consumer durable stocks showed relatively better resilience, reflecting some movement towards defensive areas as investors became cautious.
Crude oil prices offered some relief to the domestic market. Brent crude remained around the $87-$88 a barrel range amid expectations that diplomatic efforts involving Iran could ease geopolitical tensions and eventually support the reopening of the Strait of Hormuz. Lower oil prices are generally favourable for India because the country imports a large share of its crude requirements.
Global markets were also largely supportive. Asian equities gained after Nvidia’s upbeat revenue outlook strengthened expectations of continued spending on artificial intelligence and semiconductors. US stock futures also remained positive. However, these cues could not sustain buying interest on Dalal Street.
The Indian rupee, meanwhile, weakened against the US dollar. It closed at ₹95.54 per dollar, compared with ₹95.41 in the previous session.
Foreign institutional investors had bought Indian equities worth ₹502 crore on August 26, while domestic institutional investors were much stronger buyers at ₹6,425 crore. Despite this institutional support, domestic selling pressure dominated Thursday’s session.
The latest decline has left investors watching the 24,000 level on the Nifty closely. A sustained move below that mark could increase selling pressure, while a recovery above 24,200 would be needed to improve near-term sentiment.
Thursday’s session also highlighted how quickly sentiment can change during a derivatives expiry. The market started with optimism but ended firmly in the red, leaving investors cautious about the next move in the Sensex and Nifty 50.