Nifty tanks over 200 points amid broad-based sell off

After opening marginally lower by 8 points, the index extended its slide and stayed under pressure for most part of the session. Despite a late-day recovery of 68 points from the intraday low of 25,892, the index ultimately closed with a sharp fall of 225 points at 25,960.

Out of the Nifty 50 constituents, only three IT majors managed to defy the correction and close in the green: Tech Mahindra, Wipro, and HCL Tech. Conversely, Indigo, BEL, and JSW Steel bore the brunt of the selling pressure, finishing as the key laggards.

All the sectoral indices ended in the red. Leading the decline were Nifty Realty, PSU Banks, and Media, which registered the steepest losses.

The broader market saw even more significant erosion. The Nifty Midcap 100 Index plunged 1.83% and the Nifty Smallcap 100 Index plummeted 2.61%. This marks the highest single-day fall for the small-cap index since April 7, 2025, pushing it to a six-month low.

Market breadth remained weak for the seventh consecutive session. The BSE advance–decline ratio stood at 0.28, its lowest reading since May 6, 2025, signaling sustained pressure in the mid- and smallcap segments.

The Indian Rupee depreciated for a second straight day. This weakness was primarily triggered by the Reserve Bank of India’s recent decision to reduce the benchmark interest rate and introduce liquidity easing measures. This dovish policy, combined with a prevailing risk-averse market sentiment and persistent foreign fund outflows, exerted downward pressure on the currency.

By closing below the previous swing low of 25,986, Nifty has confirmed a lower bottom preceded by lower top on a closing basis, reinforcing the short-term corrective structure. A decisive move below 25,891 is likely to accelerate selling pressure and can open the downside towards the next support of 25,722, where the 50 DEMA is placed.

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Source: HDFC Securities Prime Research