Benchmark equity indices closed sharply lower on Wednesday, weighed down by a widespread sell-off in banking and IT stocks, triggered by disappointing Q1FY26 earnings and rising external uncertainties.
The S&P BSE Sensex tumbled 501.51 points to settle at 81,757.73, while the NSE Nifty50 dropped 143.05 points to 24,968.40, slipping below the key 25,000 psychological level.
Broader markets also reflected negative sentiment, with heightened volatility across mid-cap and small-cap segments on Dalal Street.
The banking sector was particularly hit, with Axis Bank shares falling over 5% after posting weaker-than-expected Q1 results. This dragged the Nifty Private Bank index down nearly 1.5%. IT stocks also underperformed, compounding the pressure on benchmarks.
According to Vinod Nair, Head of Research at Geojit Financial Services, the market faced a broad-based sell-off amid disappointing earnings from the finance and IT sectors. He noted that high valuations in large-cap stocks and substantial short positions by foreign institutional investors (FIIs) have made the investment climate more cautious.
Adding to investor concerns were growing uncertainties in India’s trade relations with Russia, especially amid discussions of potential tariff increases, which have weighed on market sentiment.
Despite the near-term volatility, Nair expressed confidence in India’s medium- to long-term outlook, citing low inflation, a favorable interest rate environment, and supportive monetary policies as stabilizing factors for future growth.
