Markets snap 7-day gaining streak: Sensex cracks 700 pts, Nifty below 23,500; bank, oil & gas stocks tumble

NTPC, Tech Mahindra, BPCL, Cipla, and Bajaj Finance were the major drags on the Nifty.

Benchmark indices Nifty and Sensex slumped on March 26, snapping a seven-day rally, as selling in SBI, HDFC Bank, and ICICI Bank, along with major oil & gas names pulled markets deep into the red.

At close, the Sensex was down 728.69 points or 0.93 percent at 77,288.50, and the Nifty was down 181.80 points or 0.77 percent at 23,486.85. About 808 shares advanced, 2,799 shares declined, and 78 shares unchanged.

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"The current market consolidation is driven by domestic selling in the broader market, March-end closing pressures, and upcoming events like the April 2 tariff deadline and RBI policy. Despite a strong seven-day rally, this seems like a natural pause to an overbought phase rather than a reaction to tariff uncertainty," Aishvarya Dadheech, Founder and CIO of Fident Asset Management said in a conversation with Moneycontrol.

He said that there are a host of positives to be taken from March such as a weaker dollar index, Rupee appreciation, and reduced FII outflows. While uncertainty regarding tariffs is keeping investors on edge currently, Dadheech doesn’t see them significantly disrupting India’s economy or markets.

Also read: Overseas investments by Indian firms grow 40% in FY25 to $36 billion amid Trump tariff storm

The broader market continued displaying weak trends with the Nifty Midcap 100 and Smallcap 100 falling 0.6 and 1 percent, respectively. Dadheech says that smallcaps have entered a relatively attractive zone, supported by strong growth prospects. However, midcaps remain expensive, requiring a selective approach.

Among sectors, Nifty Auto, up almost the entire session, pared losses to close flat. The rest of the market remained under pressure, with all 12 other sectoral indices in the red. Nifty Bank, PSU Bank, Oil & Gas, and Pharma bore the brunt, each tumbling over a percent, while Nifty IT slipped 0.98 percent. Losses in FMCG, Energy, Infra, and Metal were more subdued but still weighed on sentiment.

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Shares of Siemens Limited gained as much as 7 percent after the company announced that the National Company Law Tribunal (NCLT) approved the company’s demerger, paving the way for Siemens Energy India Ltd to operate as a separate entity. As part of the restructuring, Siemens shareholders will receive one share of Siemens Energy India for each Siemens Ltd. share they hold as of the record date, set for April 7, 2025.

Food delivery majors Zomato and Swiggy fell up to 4 percent following a Bank of America Securities report. International brokerage BofA Securities downgraded the shares of Zomato to 'Neutral' from its earlier 'Buy' rating. Analysts, however, handed Swiggy a double downgrade to 'Underperform' from 'Buy'.

Just a day after a 5 percent fall, IndusInd Bank shares closed over 3 percent after Moneycontrol reported that the crisis-hit private lender is likely to tap two large global recruitment firms – Egon Zehnder and Korn Ferry -- to identify candidates for key positions, including CEO. Last week, Reuters reported, citing sources, that RBI has urged Sumant Kathpalia and his deputy to step down as soon as replacements are found and approved. However, the bank called it "factually incorrect".

"The 23,600 level acted as a support yesterday, preventing a sharper decline. However, if the market weakens further today, it could break 23,600 and drift toward 23,300. A bounce back above 23,700–23,760 might slow the decline, though a strong rally to 24,200 seems unlikely," Anand James, Chief Market Strategist at Geojit Financial Services said.

Trent, IndusInd Bank, Hero MotoCorp, Grasim, and Bharti Airtel were the top gainers on the Nifty. NTPC, Tech Mahindra, BPCL, Cipla, and Bajaj Finance were the major drags on the Nifty.