Nifty Slips Below 24,000, Sensex Falls Over 658 Points As Broader Markets Tumble

Indian equity markets opened on a weak note on Friday, weighed down by sharp losses in banking stocks as bullish momentum paused. At 10:10 am, the Sensex had dropped 881.49 points, or 1.10 per cent, to 78,919.94, while the Nifty declined 285.05 points, or 1.18 per cent, to 23,961.65. Market breadth was negative, with 2,702 stocks declining, 436 advancing, and 101 remaining unchanged.

Broader Market Update

Broader markets underperformed the benchmarks, reflecting heightened selling pressure. The Nifty Smallcap 100 fell by 3 per cent, while the Nifty Midcap 100 slipped 2.5 per cent, indicating widespread weakness across mid and small-cap segments.

Sectorial Update

All sectoral indices were trading in the red, with the banking sector leading the losses. The Bank Nifty, Nifty Private Bank, and Nifty PSU Bank indices were all under significant pressure.

This downturn follows a strong finish in the previous session, where the Nifty 50 ended the volatile April series with a 655-point rally, having rebounded nearly 2,500 points from its lows. April-May derivatives rollovers were in line with historical averages, though FII (Foreign Institutional Investor) long exposure stood at just 41per cent, marking the lowest level of net contracts since October 2024.

VK Vijayakumar, Chief Investment Strategist, Geojit Investments, noted, "There are tailwinds and headwinds for the market now. A strong tailwind is the sustained FII buying which has touched a cumulative amount of Rs 29513 crores during the last 7 days. This is a total reversal of the momentum trade to US stocks when the dollar was strengthening. Since FII buying is likely to sustain bears will restrain from shorting the market. Another tailwind is US Treasury Secretary Scot Bessent’s remark that “ India is expected to strike the first bilateral trade deal with the US.” US also is keen to strike as many deals as possible since China’s response to US initiatives has been indifferent."

Global Cues

Overnight, Wall Street closed sharply higher amid renewed hopes for a sooner-than-expected interest rate cut by the US Federal Reserve. The Dow Jones Industrial Average rose 1.3 per cent, the S&P 500 gained 2.1 per cent, and the tech-heavy Nasdaq surged 2.7 per cent, with all "Magnificent Seven" megacap stocks posting gains. Strong earnings from Alphabet Inc. added to the optimism.

Asian markets mirrored the positive sentiment early Friday. South Korea’s Kospi climbed 1.1 per cent, Japan’s Nikkei 225 jumped 1.4 per cent, and Taiwan’s benchmark index surged 2.6 per cent, buoyed by expectations of a dovish Fed and solid corporate earnings.

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