Here are the key reasons behind today’s market decline:1. Auto stocks witnessed profit booking
Auto stocks came under selling pressure during the session, weighing on the broader market.
2. NBFC stocks remained under pressure
Non-banking financial company (NBFC) stocks also traded weak, adding to the pressure on benchmark indices.
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3. Earnings-driven selling in select stocks
Shriram Finance fell 2% after reporting a mixed set of quarterly earnings. Motilal Oswal declined 7% after its results, while V-Mart Retail dropped 5% and CG Power slipped 1% following their quarterly earnings.
4. Weakness in consumer and midcap names
Eternal and Swiggy declined on reports of increased competition. In the broader market, GE Vernova, Hero Moto, Hitachi and Amber Enterprises were among the top midcap losers.
Ashish Chaturmohta, Managing Director & Fund Manager, JM Financial Ltd, on Swiggy, said, “This is more of a technical sell-off happening due to the MSCI revision. So, maybe some selling is possible, and the stock might consolidate at lower levels.
But what is the big trigger is this company becoming an IOCC, so Indian-owned and controlled company, which will result in the company shifting from a marketplace to an inventory-led model, where the margins are going to expand significantly. Our belief is that there is extreme competitive intensity coming out in this entire space.
Blinkit, obviously, is becoming profitable, but as far as Swiggy is concerned, now, with this 200-basis-point kind of margin expansion which will happen due to this inventory-led model, we will see this company transitioning into profitability, and Zepto, somehow, is struggling a lot. So, our sense is that Swiggy is going to gain very good traction. So, on any good dip, I think Swiggy is a very good opportunity to enter at lower levels.”
5. Market breadth remained negative
The advance-decline ratio stood at 4:5, indicating that declining stocks outnumbered advancing ones. Despite the broader weakness, there were pockets of strength.
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Financial and information technology stocks recovered from intraday lows, helping the Nifty Bank index rise 102 points to 56,694. HCLTech and Wipro emerged as the top gainers on the Nifty, while KPIT Technologies and Tata Elxsi gained 4% to 6%.
The Nifty Midcap index ended 63 points lower at 61,622, while United Spirits Ltd. (USL) rose more than 4% after guiding for healthy growth in FY27.
From the Sensex basket, Cipla Ltd, ITC Ltd, Trent Ltd, Tech Mahindra Ltd, Reliance Industries Ltd and State Bank of India were the major gainers. Bajaj Finance Ltd, Eternal Ltd, Shriram Finance Ltd, Mahindra & Mahindra Ltd, Bharti Airtel Ltd and Oil and Natural Gas Corporation Ltd were the biggest laggards.
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Market This Week (July 20-24)
The equity benchmarks ended lower in all five trading sessions this week, marking their biggest weekly decline in four months. The Nifty 50 fell more than 2%, while the Sensex declined 2.5% during the week.
The Nifty Bank index underperformed the broader market, falling more than 3%, while the Nifty Midcap index declined over 1%. Among sectoral indices, the Nifty Realty index emerged as the worst performer, dropping 4% over the week.
Among the top Nifty losers were HDFC Bank, Axis Bank, Infosys, IndiGo, Dr Reddy’s Laboratories, Adani Enterprises, Bajaj Auto, HCLTech, SBI Life Insurance, Trent, Power Grid and NTPC.
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In the broader market, Bandhan Bank, Motilal Oswal Financial Services, Oracle Financial Services Software (OFSS) and Swiggy were among the top midcap losers during the week.
On the gaining side, Manappuram Finance, TVS Motor Company, Astral and United Spirits Ltd. (USL) were among the top midcap gainers.
