Daijiworld Media Network - New Delhi
New Delhi, Jul 19: Domestic equity markets extended their downward trajectory for the third straight week, with benchmark indices closing below the psychological 25,000 mark, dragged down by lacklustre earnings from key IT and financial sector companies.
Analysts attributed the ongoing correction to a weak Q1FY26 earnings season so far, with muted performance and uncertain guidance from major IT firms amid sluggish global demand. Financial stocks also weighed on sentiment, with concerns around narrowing net interest margins (NIMs) and asset quality adding to the pressure.
“The cautious outlook in IT and financials dampened overall investor sentiment,” said Vinod Nair, Head of Research at Geojit Financial Services. “However, FMCG stocks stood out, backed by optimistic growth forecasts that indicate a possible revival in urban demand. Macroeconomic support and improving earnings could make consumption plays more attractive going forward.”
On Friday, the Sensex declined 501.51 points (0.61%) to close at 81,757.73, while the Nifty 50 fell 143.05 points (0.57%) to end at 24,968.40, slipping below the 25,000 mark for the first time in weeks.
Sectoral performance was broadly negative, with all major indices closing in the red — except for Media and Metal. Notable weakness was seen in Pharma, Private Banks, PSU Banks, FMCG, Capital Goods, Consumer Durables, and Telecom, which each declined between 0.5% and 1%.
The broader markets followed suit, with the Nifty Midcap index shedding 0.7% and the Smallcap index losing 0.8%, as profit-booking intensified across segments.
Looking ahead, Bajaj Broking Research noted that both global and domestic high-frequency data points will steer market sentiment in the coming week. In India, the focus will be on the S&P Global Manufacturing PMI (Preliminary) for July, which could offer insights into the resilience of the country’s manufacturing expansion.
Globally, attention is fixed on a proposed US-India mini trade agreement, which could prove to be a tailwind for Indian export-driven sectors. A positive outcome may also improve India’s standing among emerging markets, analysts said.
Despite recent weakness, experts suggest that improving consumption trends and macro stability may soon trigger a shift in market tone — though near-term caution remains.