Why Did the Stock Market Close Lower Amid IT Stock Selling?
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Synopsis
The Indian stock market continued its downward spiral amid profit booking and FII outflows, particularly affecting the IT sector. With major indices reflecting losses, investors are left pondering the implications for future growth amid ongoing global uncertainties.
Key Takeaways
- The Sensex closed at 81,159.68, down 555.95 points.
- Nifty dropped to 24,890.85, down 166.05 points.
- Profit booking and FII outflows continued to impact market performance.
- Heavy selling was observed in auto, IT, pharma, and healthcare sectors.
- Metals gained due to external support factors.
Mumbai, Sep 25 (NationPress) The Indian equity markets experienced a continued decline for the fifth day in a row on Thursday, driven by FII outflows, profit-taking, and ongoing sell-offs in the IT sector.
The Sensex wrapped up the trading day at 81,159.68, falling by 555.95 points or 0.68%. The 30-share index commenced under pressure at 81,574.31, compared to the previous session's close of 81,715.63, amidst widespread selling. The index further dropped, reaching an intraday low of 81,092.89.
The Nifty index concluded at 24,890.85, down 166.05 points or 0.66%.
According to an analyst, "The Indian markets have extended their downward trend for a fifth consecutive session as investors engaged in profit booking, amid ongoing FII outflows and uncertainty surrounding US-India trade discussions, which are projected to impact Q2 GDP growth.
Widespread selling was evident across the market, with significant declines in the auto, IT, pharma, and healthcare sectors, while the metals sector showed gains, aided by China’s liquidity support and concerns over copper supply.
General market sentiment remains cautious as traders await India’s H2 FY26 borrowing details and US macroeconomic data, which is expected to be released at the end of the week.
Stocks such as Trent, PowerGrid, Tata Motors, TCS, Asian Paints, NTPC, Bajaj Finance, Bajaj FinServ, Mahindra and Mahindra, HCL Tech, Eternal, Titan, Kotak Bank, Tech Mahindra, L&T, SBI, and Ultratech Cement closed negatively within the Sensex basket. However, BEL, Axis Bank, and Bharti Airtel ended the day in the green.
Sectoral indices closed predominantly in the red amid continuous selling pressure. Nifty Auto fell by 249 points or 0.92%, Nifty FMCG decreased by 270 points or 0.49%, Nifty IT ended 445 points or 1.27% lower, Nifty Fin Services dropped 141 points or 0.53%, and Nifty Bank concluded 145 points or 0.26% lower.
The broader indices mirrored this trend as well. Nifty Next 50 fell by 514 points or 0.75%, Nifty 100 dipped 174 points or 0.68%, Nifty Midcap 100 closed down 368 points or 0.64%, and Nifty Small Cap 100 fell 102 points or 0.57%.
Point of View
I view the ongoing bearish trend in the Indian stock market as a nuanced situation stemming from both domestic and international pressures. While profit booking and FII outflows are evident, the broader implications of these movements suggest a need for cautious optimism and strategic investment choices moving forward.
NationPress
25/09/2025
Frequently Asked Questions
What are FII outflows?
FII outflows refer to the money that foreign institutional investors withdraw from the domestic stock market, which can significantly impact market sentiment and stock prices.
How did the IT sector perform today?
The IT sector saw substantial selling pressure, leading to a drop of 1.27% in the Nifty IT index.
What factors are contributing to the market decline?
The market decline is primarily attributed to profit booking, foreign institutional investor outflows, and uncertainty regarding US-India trade talks.
What does the market sentiment look like for the upcoming week?
The sentiment remains cautious as investors await crucial economic data from the US and details on India's borrowing for H2 FY26.
Which sectors showed gains amidst the selling?
While most sectors experienced losses, the metals sector gained due to China's liquidity support and concerns over copper supply.
