Sensex and Nifty Fall for Second Day Amid Banking Selloff and Foreign Fund Outflows

Mumbai, July 18 – Indian equity markets closed sharply lower on Friday, extending their losing streak for the second consecutive session, as a combination of foreign fund outflows and pressure on banking stocks weighed on investor sentiment.

Indices Drop on Banking Drag and Earnings Concerns

The BSE Sensex fell by 501.51 points or 0.61%, settling at 81,757.73, after plunging as much as 651.11 points during intraday trade to a low of 81,608.13.

The NSE Nifty declined by 143.05 points or 0.57%, closing below the psychological 25,000-mark at 24,968.40.

The downtrend was primarily led by banking stocks following the underwhelming June quarter results of Axis Bank, which reported a 3% decline in consolidated net profit to ₹6,243.72 crore. The results were impacted by adjustments in non-performing asset recognition and loan upgrade policies, sparking investor concerns over asset quality.

Axis Bank Drags Bank Index Lower

Axis Bank shares plunged 5.24%, marking the steepest loss among Sensex constituents. The bank’s Global Depository Receipts (GDR) also fell 4.8% to USD 64.30 on Thursday, reflecting global concern over its Q1FY26 performance.

Other major banking names such as HDFC Bank, Kotak Mahindra Bank, and State Bank of India also closed in the red, dragging the BSE Bankex down 1.33% to 62,741.65.

Additional laggards included Bharat Electronics, Bharti Airtel, Titan, and Eternal.

Selective Buying in Other Sectors

Despite the broader weakness, some stocks bucked the trend. Bajaj Finance, Tata Steel, ICICI Bank, HCL Tech, and Infosys registered gains, providing partial support to the benchmark indices.

Foreign Outflows Add Pressure

Adding to the selloff, Foreign Institutional Investors (FIIs) pulled out ₹3,694.31 crore from domestic equities on Thursday, as per exchange data.

Mixed Global Cues

In global markets, South Korea’s Kospi and Japan’s Nikkei 225 closed lower, while Shanghai Composite and Hong Kong’s Hang Seng ended with gains. European markets were trading in the green during Indian market hours, and US indices closed higher on Thursday.

On the commodities front, Brent crude oil rose 0.92% to trade at USD 70.16 per barrel, contributing to cautious sentiment in emerging markets.

Previous Session Recap

On Thursday, the Sensex had lost 375.24 points (0.45%) to end at 82,259.24, while the Nifty had dropped 100.60 points (0.40%) to settle at 25,111.45.

Market Outlook

With earnings season underway and investor caution rising over asset quality in the banking sector, equity markets may continue to face volatility in the near term, especially amid ongoing FII outflows and global macroeconomic signals.

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