Sensex and Nifty Decline Sharply Amid Geopolitical and Earnings-Related Pressures
Indian benchmark indices Sensex and Nifty witnessed a sharp decline on April 25 as selling pressure gripped the broader market. The Sensex dropped by over 700 points, while the Nifty slipped below the 24,000 mark amid broad-based losses. Most sectors except IT traded in negative territory, with significant declines seen in PSU, realty, telecom, and oil & gas sectors. The BSE Midcap and Smallcap indices also fell by around 2 percent each, indicating widespread weakness across the market spectrum.
Highlights:
Sensex and Nifty down over 1.5 percent each.
Broader market indices like Midcap and Smallcap down 2 percent.
IT stocks outperform; PSU, media, telecom sectors decline steeply.
Early Gains Reversed as Market Sentiment Turns Bearish
The market opened with optimism, buoyed by foreign institutional inflows and strong cues from global markets. The Sensex initially surged by over 300 points to reach 80,130.66, while the Nifty rose to 24,365.45 in early trade. However, the rally proved short-lived as selling pressure emerged mid-session, dragging indices deep into the red. By noon, around ₹7.5 lakh crore in market capitalisation had been wiped out as investor sentiment deteriorated.
Highlights:
Morning rally erased as indices reversed sharply lower.
₹7.5 lakh crore market cap lost by mid-session.
Weakness driven by heavyweight losses and fragile investor sentiment.
Geopolitical Tensions Along LoC Erode Market Confidence
One of the key drivers behind the sell-off was escalating geopolitical stress following a major terror incident in Jammu & Kashmir’s Pahalgam on April 22, which left 26 people dead. Subsequent retaliatory action by the Indian Army against Pakistani posts further heightened tensions along the Line of Control (LoC). Traders noted that additional steps, including India’s suspension of the Indus Water Treaty and a downgrade in diplomatic relations, may prolong the uncertainty and dampen investor appetite for risk assets in the near term.
Highlights:
Indo-Pak tensions rise after terror attack and retaliatory strikes.
India suspends Indus Water Treaty and diplomatic ties reportedly downgraded.
Heightened uncertainty impacts near-term market sentiment.
Subdued Q4 Earnings Add to Market Pressures
Investor worries were also amplified by lacklustre Q4 earnings from several corporates. According to an analysis of 111 non-financial and non-energy firms, operating profit growth slowed to 6 percent year-on-year—its weakest in five quarters. The continued moderation in earnings reflects a broader challenge in reviving demand and sustaining profitability amid high input costs and weak consumption. Market watchers remain cautious about earnings momentum going forward.
Highlights:
Q4 earnings growth slows to 6% YoY among non-financial firms.
Earnings momentum weak due to sluggish sales and demand.
Marks 7th consecutive quarter of single-digit profit growth.
Profit Booking and Sectoral Drag Compound Market Fall
After a sustained market rally over the past few sessions, profit booking emerged as a natural counterforce. On Thursday, markets had ended their seven-session winning streak, triggering some short-term selling pressure. Additionally, banking stocks significantly weighed on benchmarks, with the Nifty Bank index falling nearly 1.6 percent. Axis Bank led the declines, falling over 3.5 percent following the release of Q4 results that showed a marginal dip in net profit.
Highlights:
Profit booking after strong previous sessions added pressure.
Nifty Bank index down 1.6%; Axis Bank falls over 3.5%.
11 of 12 Nifty Bank constituents in the red; IndusInd Bank the sole gainer.
