Foreign Institutional Investors intensified their selling last week

Indian markets declined last week, reversing early gains amid trade uncertainty and disappointing earnings. The BSE Sensex fell 0.4% to 81,463 points, while the Nifty50 dropped 0.5% to 24,837 points, slipping below the key 25,000 level crossed on July 21. Broader markets underperformed significantly, with the midcap and smallcap indices declining by 1.5% and 1.9%, respectively.

Foreign institutional investors intensified selling, offloading ₹13,553 crore in equities, though domestic institutions provided support by purchasing ₹17,932 crore worth of stocks. Weakness in the financial and heavyweight sectors drove the decline, despite pockets of strength in pharmaceuticals and select mid-cap stocks.

Sectoral performance was broadly negative

Sectoral performance was broadly negative, with the media leading losses at -5.7%, followed by real estate (-4.9%), IT (-4.1%), oil & gas (-3.5%), and FMCG (-3.4%). Only pharmaceuticals (+0.5%) and healthcare (+1.2%) posted gains.

Manufacturing surges in July

Despite market headwinds, India’s manufacturing sector surged in July, with the HSBC Flash Manufacturing PMI rising to 59.2—its highest reading in nearly 17 and a half years—the acceleration from June’s 58.4 signals robust factory conditions driven by strong domestic and international demand.

Indian officials remain hopeful for a US trade deal, but uncertainty persists with days remaining before potential tariff increases.

Disclaimer : This content is only for informational purpose. It does not make any recommendation to act or invest. To get any error corrected, please write to content@hdfcsec.com.

Source: HDFC Securities Prime Research