Mumbai: Domestic equity markets witnessed a sharp sell-off on Friday, tracking weak global cues and heavy selling in IT stocks. The Sensex plunged nearly 1,000 points while the Nifty also closed deep in the red. The broad-based decline led to a steep erosion in investor wealth, with the total market capitalisation of BSE-listed companies falling from around ₹472 lakh crore to ₹465 lakh crore — a loss of nearly ₹7 lakh crore in a single session.
Markets remained under pressure right from the opening bell. The Sensex opened at 82,902 and slipped over 950 points within minutes. The Bank Nifty dropped more than 500 points to hover near the 60,233 mark. The weakness was not confined to largecaps; midcap and smallcap stocks also witnessed widespread selling, reflecting extremely poor market breadth.
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IT Stocks Lead the Fall
Market participants attributed the bulk of the decline to heavy selling in IT stocks. Given the sector’s high weight in benchmark indices, its weakness had a direct impact on both the Sensex and the Nifty. Rising concerns over global artificial intelligence–led disruption have weighed on technology stocks, with investors fearing that AI-driven automation could dent the traditional IT services business model.
All Sectors End in the Red
Alongside IT, sharp declines were seen in metal, energy and realty stocks. Almost all sectoral indices closed lower. Midcap and smallcap stocks fell more sharply than their largecap peers, indicating a drop in risk appetite among investors.
Three Key Reasons Behind the Sell-Off
First, the steep decline in IT stocks, which set the negative tone for the broader market.
Second, profit booking after the recent rally, particularly following optimism around the India–US trade agreement that had pushed indices higher in previous sessions.
Third, a cautious stance by foreign investors. Volatility in the rupee and elevated US bond yields kept FII buying subdued, adding to market pressure.
Is This the Start of a Bigger Downtrend?
According to market experts, the current decline appears to be a normal correction rather than panic-driven selling. Technically, the Nifty continues to hold above the crucial 25,500–25,400 support zone, suggesting that the underlying market structure remains intact.
Strategy for Investors
Analysts advise long-term investors not to panic. Stocks with strong fundamentals and balance sheets can be accumulated in a staggered manner. Instead of deploying capital in one go, a phased buying approach with some cash in hand is considered prudent.
Traders have been advised to wait for the market to stabilise near support levels before initiating fresh positions. This is not a market to chase momentum blindly.
A 1–2 percent pullback after a sustained rally is generally viewed as healthy, as it helps cool valuations and builds a stronger base for the next move. While volatility may persist in the near term, the current correction could present selective buying opportunities for long-term investors.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
