Sensex Tumbles 721 Points, Nifty 50 Gives Up 25,000, Pharma Bucks Trend

Benchmark equity indices fell for a second straight session on July 25, erasing early-week gains and slipping back to levels last seen a month ago. Weak global cues and muted corporate earnings continued to weigh on investor sentiment. The two-day sell-off wiped out Rs 9.75 lakh crore in investor wealth. The total market capitalisation of all the companies listed on the Bombay Stock Exchange (BSE) now stands at Rs 451.68 lakh crore.

The Sensex fell 721.08 points, or 0.88 per cent, to 81,463.09, and the Nifty 50 lost 225.20 points, or 0.90 per cent, to close at 24,837.00.

Sell-Off More Intense In Broader Markets

The sell-off was more intense in the broader market, as the Nifty Midcap 500, which represents more than 90 per cent of the free-float market capitalization of all the stocks listed on the National Stock Exchange (NSE), closed 1.23 per cent lower.

The Nifty Midcap 100 and Nifty Smallcap 100 declined 1.61 per cent and 2.10 per cent, respectively. The Nifty Microcap 250 index, which tracks the performance of the top 250 valuable companies beyond the Nifty 500 constituents, also lost 1.89 per cent during the session.

Pharma, Healthcare Buck Trend

Most sectoral indices closed the day in the red, barring pharma and healthcare. Nifty Energy fell 2.21 per cent, Nifty Metal lost 1.64 per cent, Nifty IT slipped 1.42 per cent, and Nifty Auto declined 1.27 per cent. Nifty Media fell the most, losing 2.61 per cent.

Nifty Bank, which tracks the performance of India’s top 12 private and public banks, fell 0.94 per cent to close at 56,528.90. Nifty PSU Bank fell 1.70 per cent, while the Nifty Private Bank shed 0.97 per cent.

Nifty Financial Services ended 0.88 per cent lower, dragged by the Bajaj Finance and Bajaj Finserv, after the twins reported their Q1 earnings. Nifty Realty and Nifty FMCG also ended lower by nearly a per cent each.

Bucking the trend, Nifty Pharma and Nifty Healthcare rose 0.54 per cent and 0.69 per cent, respectively, on upbeat Q1 results by Cipla.

Why Market Fell Today

According to Vinod Nair, head of research, Geojit Financial Services, muted corporate earnings and weak global cues triggered a broad-based sell-off across domestic equities. He noted that “elevated valuations in large-cap stocks, coupled with significant net short positions held by foreign institutional investors (FIIs)” further contributed to the downward pressure.

Nair added that investor sentiment remained fragile amid continued uncertainty over India-US tariff negotiations and the European Central Bank's decision to hold rates steady. Rate cuts, he said, have been deferred “until clearer insights emerge on the inflationary impact of trade developments.”

According to Ajit Mishra, senior vice president, research, Religare Broking, the recent market correction reflects rising concerns over earnings disappointments and cautious commentary from company managements, both of which are denting investor confidence. He added that persistent selling by FIIs is further intensifying the pressure on equities.

Key Market Cues For Monday, July 28

India-US Trade Deal: India is making "fantastic progress" in its trade deal talks with the United States (US), Commerce Minister Piyush Goyal said during his visit to London, where he signed the historic free trade agreement (FTA) with the United Kingdom (UK) on July 24.

US President Donald Trump had earlier announced a 26 per cent tariff on Indian goods on April 2 as part of his broader trade measures. While those tariffs were initially paused until July 9, the deadline was later pushed to August 1.

Indian officials have been making frequent trips to Washington in an effort to wrap up the negotiations. Investors will be closely watching this space for any breakthrough, or lack of it.

Thailand-Cambodia Border Tensions: Thai and Cambodian soldiers clashed along their border, killing at least 15 people. Both sides used guns, rockets, and artillery, while Thailand also carried out airstrikes. Each country blamed the other for starting the violence and targeting civilians.

Investors will be tracking any further escalation in their dispute to gauge its potential impact on regional stability and global market sentiment.

Q1 Earnings: As many as 38 companies are set to release their Q1 earnings during the weekend, July 26-27.

Some of the major names include IDFC First Bank, Kotak Mahindra Bank, Lodha Developers, Whirlpool, and Balkrishna Industries.