Indian stocks fell sharply on Monday, with the Nifty 50 dropping 1.11% to close at 22,888 and the Sensex declining 1.17% to 73,852. The market lost ₹3.6 lakh crore in overall capitalization within six hours, falling from ₹472.6 lakh crore to ₹469 lakh crore. This sell-off ended an eight-week losing streak and was driven by weak earnings from major private sector banks, elevated crude oil prices, and weak global cues, according to livemint.com.
The decline was led by private sector banks, which fell 1.7%, with HDFC Bank and Axis Bank losing 2% and 4.1%, respectively, after their July-September quarter results missed profit estimates. HDFC Bank's performance was affected by weaker treasury income and higher provisions for bad loans, while Axis Bank reported higher operating expenses and weaker other income. Net interest margins declined at both banks. Together, HDFC Bank, ICICI Bank, and Axis Bank accounted for more than half of the Sensex’s decline, with the Nifty Private Bank index dropping around 1.8%.
The broader market also reflected the negative trend, with the Nifty Smallcap 100 and Nifty Midcap 100 indices each falling by 1%. Sectoral losses were widespread, except for the Nifty PSU Bank index, with chemicals, FMCG, cement, and IT sectors also registering declines. Elevated crude oil prices and weak global market cues contributed to profit booking by investors, intensifying the market downturn. The sharp sell-off highlights the sensitivity of Indian markets to banking sector earnings and external economic factors.
The market capitalization of BSE-listed firms dropped to ₹469 lakh crore by the end of Monday’s trading session, marking a significant loss of investor wealth in a single day. The next major earnings reports from private banks will be closely watched for signs of recovery or further weakness.