Sensex tumbles 270 pts, Nifty below 25,000 as IT, oil & gas stocks drag; smallcap index outperforms

Grasim, Eternal, Tata Consumer Products, Infosys and TCS were the major laggards on the index.

Benchmark indices Nifty and Sensex surrendered their early gains and slipped deep into the red on May 19, as a sharp selloff in IT and oil & gas heavyweights weighed on sentiment. The day began on a decent note but quickly turned south, marking a weak start to the week. The Nifty Auto index, however, offered some relief by continuing its upward momentum for a fourth straight session.

At close, the Sensex was down 271.17 points or 0.33 percent at 82,059.42, and the Nifty was down 74.35 points or 0.30 percent at 24,945.45. About 2436 shares advanced, 1500 shares declined, and 175 shares unchanged.

“The market is undergoing a healthy round of profit booking after last week’s sharp rally,” Siddhartha Khemka, Head of Research and Wealth Management at Motilal Oswal, told Moneycontrol. “The Nifty had surged 4.5 percent in just one week, so some cooling off was expected. Limited global cues are also preventing fresh buying, leading to a consolidation phase.” Khemka noted that Friday had also seen similar selling pressure, which spilt into Monday’s session.

Among the highlights of the day was Bajaj Auto, which surged over 4 percent after its Netherlands-based investment arm raised Rs 5,426.5 crore via unsecured loans. The funds will support the restructuring of KTM AG, the bankrupt Austrian motorcycle maker in which Bajaj holds a 49.9 percent stake.

Sector-wise, the market showed mixed trends. Nifty IT was the worst performer, down 1.30 percent, followed by losses in FMCG, Oil & Gas, and Media indices. Meanwhile, volatility returned with a jolt, as India VIX spiked 4.41 percent to 17.28, reflecting rising nervousness among traders.

On the brighter side, the Nifty Realty index led gains, climbing 2.24 percent. PSU Banks followed with a 1.60 percent rise, while pharma stocks also saw traction—pushing the Nifty Pharma index up 0.75 percent. The Nifty Auto and Smallcap 100 added 0.52 percent and 0.72 percent, respectively.

The broader market continued to outshine frontline indices. Nifty Midcap 100 and Smallcap 100 rose 0.1 percent and 0.6 percent, respectively—buoyed by strong institutional flows. Both foreign and domestic investors have been pouring funds into the broader space, driven by a wave of sector-specific themes—like monsoon-linked agri demand, rural recovery, and defence—that are more prominently represented outside large-cap names.

Among individual stocks, Divi’s Laboratories stole the spotlight with a 6 percent jump after posting a solid set of numbers for Q4FY25. Net profit rose 23 percent to Rs 662 crore, with revenue growing 12.2 percent year-on-year to Rs 2,585 crore, led by a recovery in its API segment.

On the flip side, defence major Hindustan Aeronautics Ltd (HAL) dropped 2 percent after reporting an 8 percent year-on-year decline in quarterly profit. The fall was attributed to delays in Tejas fighter jet deliveries. HAL’s net profit for Q4 fell to Rs 3,977 crore from Rs 4,309 crore a year earlier, while revenue dropped 7.2 percent to Rs 13,700 crore.

From a technical perspective, markets are approaching key resistance levels. “Only the October 2024 peak of 25,235 lies ahead before the September high of 26,277 looms large,” said Anand James, Chief Market Strategist at Geojit Financial Services. “This setup calls for caution as we approach these levels. The uptrend may continue, but if the index fails to clear 25,235 or breaks below 24,870–24,807, expect a sharper pullback.”

Top gainers on the Nifty included Bajaj Auto, Shriram Finance, Hero MotoCorp, Bajaj Finance, and Power Grid Corp. Meanwhile, major laggards were Grasim, Eternal, Tata Consumer Products, Infosys, and TCS.

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