Nifty Dips Below 24,900 as FIIs Sell Amid Geopolitical Tensions; Broader Market Holds

India’s benchmark indices witnessed a turbulent trading session on June 17, 2025, with the Sensex and Nifty sliding amid heavy foreign selling and persistent geopolitical anxiety in the Middle East. The Sensex closed 228.85 points lower at 81,567.30, down 0.28%, while the Nifty slipped 74.10 points or 0.30% to end at 24,872.40. Despite this weakness in large caps, broader market indices showed resilience as the BSE Midcap and Smallcap indices rose 0.3% each. Sectoral trends were mixed: real estate and PSU banks gained, while pharma stocks and selected blue chips lagged. Market participants cited weak cues from global equities and uncertainty surrounding the US-Iran standoff as reasons behind the cautious tone.

Highlights

• Sensex dropped by 228.85 points; Nifty fell below 24,900

• BSE Midcap and Smallcap indices posted modest gains

• FIIs continued selling, influenced by global political unrest

• Mixed sectoral performance with realty and PSU banks up, pharma down

Also Read : Big Mutual Funds Reduce Cash Holdings in May 2025; Over 60% of Equity Schemes Show Decline

Foreign Institutional Selloff Accelerates Amid Middle East Tensions

Foreign Institutional Investors (FIIs) remained net sellers in the Indian equity market for the fourth straight session, intensifying downward pressure on frontline indices. On June 16 alone, FIIs pulled out ₹2,539 crore from domestic equities, raising concerns about near-term stability. This persistent offloading is widely attributed to the global spike in risk aversion as geopolitical stress escalates. The standoff between Israel and Iran entered its fifth consecutive day, compounded by US President Donald Trump’s abrupt withdrawal from the G7 summit. His call for the evacuation of Tehran and renewed criticism of Iran’s nuclear policies further stoked investor unease. Despite this exodus by FIIs, Domestic Institutional Investors (DIIs) stepped in with net purchases of ₹5,780 crore, offering a partial cushion to the market.

Highlights

• FIIs sold ₹2,539 crore worth of equities on June 16

• DIIs provided support with ₹5,780 crore in net buying

• Geopolitical crisis between Israel and Iran drives global risk aversion

• Trump’s G7 exit and Tehran evacuation orders deepen investor anxiety

Broader Markets Resist Weakness: Midcaps and Smallcaps Outperform

While benchmark indices faltered under global and institutional pressures, broader markets outperformed, driven by sustained interest in midcap and smallcap counters. The BSE Midcap and Smallcap indices climbed 0.3%, highlighting a rotation of funds toward more domestically driven themes. Analysts noted that investors are increasingly scouting for value in segments less vulnerable to global volatility. The market breadth remained positive, with 1,811 stocks advancing, 1,440 declining, and 158 remaining unchanged on the BSE. Sectors like real estate (+1%) and PSU banks (+0.5%) were the top contributors to the broader rally, with selective buying in stocks like Canara Bank, Union Bank, and DLF supporting sentiment.

Highlights

• BSE Midcap and Smallcap indices gained 0.3%

• Market breadth remained positive with more advances than declines

• Realty and PSU bank stocks led the gains in broader indices

• Investors turned to domestic stories amid global headwinds

Stock Movers: Axis Bank, Zee Entertainment, and Vishal Mega Mart in Focus

Stock-specific action continued to dominate intraday headlines as companies announced major corporate developments. Axis Bank, ICICI Bank, SBI, and Kotak Mahindra Bank emerged as gainers on the Nifty, supported by bullish institutional inflows. In contrast, Bajaj Finance fell sharply due to post-adjustment in stock price following a bonus issue and split, triggering temporary valuation concerns. Zee Entertainment saw a 4% rise as promoters unveiled a ₹2,237 crore fund infusion via convertible warrants, reviving interest in the embattled media giant. Meanwhile, Vishal Mega Mart dropped 8% after reports suggested its promoters are likely to sell ₹10,500 crore worth of stake via a block deal—prompting profit booking among investors wary of overhang.

Highlights

• Axis Bank, SBI, ICICI Bank among top Nifty gainers

• Bajaj Finance declined on post-adjustment technical weakness

• Zee Entertainment surged 4% on promoter funding plans

• Vishal Mega Mart fell 8% amid stake sale speculation

Bank Nifty Struggles Near Resistance; Technical Analysts Advise Caution

The Nifty Bank index struggled to hold on to gains, facing stiff resistance near the psychological 56,000 mark. It closed slightly lower at 55,905, down 0.07%, with an advance-to-decline ratio of 7:5—indicating selective participation. Analysts tracking banking trends observed that while public sector lenders outperformed, private banks remained range-bound. The lack of strong follow-through buying reflects investor caution and the possibility of further consolidation in the short term. Technical experts suggest a ‘buy on dips’ approach, with support likely around 55,500. However, any sustained weakness below that level could trigger short-term corrections, especially if global sentiment remains fragile.

Highlights

• Nifty Bank closed at 55,905, down marginally by 0.07%

• Resistance observed at 56,000 as index fails to break out

• Advance/decline ratio of 7:5 indicates selective participation

• Analysts advise caution and dip-based accumulation strategy

Global Markets Mixed as Traders React to Oil Prices, US Politics, and Asia-Pacific Data

Global cues remained fragile with mixed sentiment across Asia and Europe. While Japan’s Topix rose 0.3%, Australia’s S&P/ASX 200 and Hong Kong’s Hang Seng slipped marginally. The Shanghai Composite declined by 0.2% amid regulatory uncertainty and weak factory output. Euro Stoxx 50 futures fell 0.7% as European markets braced for spillover from Middle East instability. US equity futures also fell, with S&P 500 futures down 0.3% by mid-afternoon Tokyo time. Oil prices edged higher amid supply disruption fears linked to the Israel-Iran conflict. Traders continue to monitor US political signals, especially with President Trump’s latest foreign policy actions potentially influencing energy markets and global trade routes.

Highlights

• S&P 500 futures down 0.3%, Euro Stoxx 50 futures fell 0.7%

• Asia-Pacific markets mixed amid weak Chinese economic data

• Oil prices ticked up due to Israel-Iran tension

• Global traders wary of US foreign policy’s impact on risk assets

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