The Indian equity markets concluded Friday's trading session on a distinctly negative note, extending the cautious sentiment from the previous day into a significant decline. Key benchmark indices registered sharp falls, with the Nifty breaching the critical 25,000 mark. Investor sentiment was heavily impacted by a combination of weak Q1 earnings reports from major companies, persistent selling by Foreign Institutional Investors (FIIs), and lingering global macroeconomic uncertainties. While most sectors witnessed a broad-based decline, the Metal, Media, and IT sectors showed some resilience, attempting to defy the overall downtrend.
Table of Contents
- Key Market Indices Performance
- Broader Market Shows Widespread Weakness
- Sector-wise Performance Highlights
- Top Stock Market News of the Day
- FII and DII Activity This Week
- IPOs, Listings, and Market Buzz
- Top Gainers and Losers (Intra-day July 18, 2025)
- Economic and Global Factors
- What to Watch in the Coming Days
- Final Takeaway
Key Market Indices Performance
Indian equity benchmark indices settled sharply lower on Friday, 18th July 2025, as investor concerns escalated.
The BSE Sensex plummeted by 501.51 points, a decline of 0.61 per cent, to close at 81,757.73.
The NSE Nifty50 settled at 24,967.45 levels, down by -144 points or 0.57 per cent, notably slipping below the 25,000 psychological mark.
Broader Market Shows Widespread Weakness
The negative sentiment was pervasive across market segments. The Nifty MidCap 100 index fell 0.7 per cent, while the Nifty SmallCap 100 index was down by 0.82 per cent. This broad-based selling indicated deep-seated concerns among investors, affecting companies of all sizes.
Sector-wise Performance Highlights
Sectoral performance on Friday showed significant pressure across the board, with only a few exceptions. The Nifty Private Bank sector emerged as the top laggard, declining sharply by 1.46 per cent, primarily dragged down by Axis Bank's disappointing Q1 results. Other major sectors that closed in the red included Nifty Bank, Financial Services, Consumer Durables, Energy, Auto, FMCG, Realty, Oil & Gas, and Pharma.
In contrast, the Nifty Metal, Media, and IT sectors managed to end in the green, indicating some selective buying interest in these segments. The India VIX, a key gauge of market volatility, settled higher by 1.33 per cent at 11.39 points, reflecting an increase in market uncertainty and investor apprehension.
Top Stock Market News of the Day
Several key domestic and global news events significantly influenced market movements:
- Weak Q1 Earnings: The Q1 earnings season continued to disappoint. Axis Bank's net profit dropped 3.8% YoY, triggering a sharp decline in financial stocks. Wipro reported a 10% YoY increase in net profit but a 7% QoQ decrease, with the company expecting a sequential growth of -1% to 1% for Q2. CEAT's Q1 profit dropped 28% despite revenue growth. JSW Steel, however, posted strong Q1 results with a 158% YoY surge in consolidated net profit, beating estimates. Bandhan Bank's PAT dropped 65% YoY.
- FII Selling: Foreign Institutional Investors (FIIs) remained net sellers for the second consecutive session, offloading equities worth ₹3,694 crore, adding to the negative pressure on the market.
- Citi Downgrades India: Citi downgraded Indian equities from 'overweight' to 'neutral,' citing elevated valuations and a moderation in earnings growth expectations.
- US Federal Reserve Uncertainty: Global sentiment turned cautious due to conflicting signals from US Federal Reserve officials regarding interest rate cuts, with markets now seeing almost no chance of a July rate cut.
- Rising Oil Prices: Crude oil prices rose sharply following drone attacks in northern Iraq, renewing concerns over input cost pressures for oil-importing nations like India.
- Jane Street Scandal Fallout: The fallout from SEBI's market manipulation case against Jane Street reportedly wiped out 35% of index options premium turnover on NSE on Thursday's weekly expiry.
FII and DII Activity This Week
The activity of Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) continued to show a clear divergence:
- Foreign Institutional Investors (FIIs) remained persistent net sellers in July. On July 18th, they sold equities worth ₹3,694.31 crore. For July month-to-date, FIIs have been net sellers, contributing to the overall market decline. This sustained selling reflects global uncertainties, elevated valuations in India, and potentially more attractive valuations in other markets.
- Domestic Institutional Investors (DIIs) continued to provide crucial support to the market by remaining strong and consistent buyers. On July 18th, they bought equities worth ₹2,820.77 crore. Their robust buying has been a key factor in cushioning the domestic markets against sharper falls, highlighting the increasing resilience of the Indian market driven by domestic liquidity and investor confidence.
IPOs, Listings, and Market Buzz
The primary market continued to show activity despite the broader market weakness, with new offerings lined up:
- Indiqube Spaces Limited IPO is set to open on July 23, 2025, aiming to raise ₹700 crore. The price band is ₹225 to ₹237 per share, with listing expected on July 30, 2025.
- GNG Electronics Limited IPO is also scheduled to open on July 23, 2025, with a target to raise ₹460.43 crore. The price band is between ₹225 and ₹237 per share, and listing is expected on July 30, 2025.
Top Gainers and Losers (Intra-day July 18, 2025)
On Friday, 18th July 2025, the market saw significant shifts in stock performance:
Top Gainers (Intra-day July 18, 2025 - Nifty 50):
- Wipro
- Closing Price: ₹266.90
- Percentage Change: 2.56%
- Observation: Wipro emerged as a top gainer, possibly due to its Q1 results, which, despite a sequential dip in profit, showed a year-on-year increase and an improved EBIT margin, potentially being perceived as relatively better than some peers in the challenging IT environment.
- Tata Steel
- Closing Price: ₹162.51
- Percentage Change: +1.63%
- Observation: Tata Steel continued its upward trend, likely benefiting from a rebound in metal prices and positive sentiment in the sector, despite the broader market weakness.
- HCL Technologies
- Closing Price: ₹1,549.80
- Percentage Change: +1.17%
- Observation: Despite overall IT sector weakness, HCL Tech managed a modest gain, indicating some resilience or selective buying interest ahead of or post its earnings.
- ONGC
- Closing Price: ₹246.24
- Percentage Change: +0.97%
- Observation: Gains in ONGC could be attributed to the sharp rise in crude oil prices on the day, which directly impacts upstream oil companies positively.
- Nestle India
- Closing Price: ₹2,473.00
- Percentage Change: +0.98%
- Observation: Nestle India's gain suggests continued investor confidence in the defensive FMCG sector and the company's strong brand presence amidst market volatility.
Top Losers (Intra-day July 18, 2025 - Nifty 50):
- Axis Bank
- Closing Price: ₹1,098.90
- Percentage Change: -5.25%
- Observation: Axis Bank experienced the steepest decline following its Q1 FY26 results, which showed a drop in net profit due to higher provisions, triggering a sharp sell-off and spooking investors in the broader financial sector.
- Shriram Finance
- Closing Price: ₹644.80
- Percentage Change: -3.10%
- Observation: Shriram Finance also saw a significant fall, likely reflecting broader concerns in the financial services sector stemming from Axis Bank's disappointing results and overall cautious sentiment.
- Bharat Electronics (BEL)
- Closing Price: ₹394.70
- Percentage Change: -2.35%
- Observation: BEL's decline could be due to profit booking after recent strong gains or a broader market weakness impacting defence stocks, as investors moved away from riskier assets.
- HDFC Life Insurance
- Closing Price: ₹739.50
- Percentage Change: -1.64%
- Observation: Negative sentiment in the financial sector extended to insurance companies, leading to a dip in HDFC Life, as investors reacted to the overall weakness in banking and financial stocks.
- Kotak Mahindra Bank
- Closing Price: ₹2,141.80
- Percentage Change: -1.22%
- Observation: Kotak Bank also contributed to the drag on the banking index, aligning with the negative sentiment surrounding private banks and the broader market's reaction to weak earnings reports.
The day's performance clearly highlighted a strong bearish sentiment, primarily driven by disappointing earnings from heavyweights like Axis Bank and persistent FII outflows. While certain sectors like Metal and IT showed some defiance, the broader market remained under considerable pressure.
Economic and Global Factors
Several broader economic and global factors influenced market sentiment:
- RBI Policy Stance: No new announcements, but market participants continue to factor in the RBI's accommodative stance following the June 6th Monetary Policy Update, which reduced the repo rate to 5.50 per cent.
- India's Inflation: Retail CPI inflation cooled to a six-year low of 2.10 per cent (provisional) year-on-year for June 2025, reinforcing expectations of a dovish RBI stance, although July's CPI data is awaited on August 12th.
- Crude Oil Prices: Crude oil prices increased on Friday, with Brent crude futures rising to around $70 per barrel. This rise raises concerns about input costs for Indian industries and potential inflationary pressures.
- Global Factors: Fading hopes of a near-term US Federal Reserve rate cut due to sticky inflation (US inflation rose 0.3 per cent in June) continued to add market uncertainty and strengthened the US dollar. Citi's downgrade of Indian equities to 'neutral' also impacted sentiment. Despite global headwinds, India's domestic consumption story continues to attract long-term interest.
What to Watch in the Coming Days
As the week concludes, investors will closely monitor several key events:
- Upcoming Economic Data: The next release for India's CPI for July 2025 is on 12th August 2025. Global economic calendars indicate various international data points like Euro area GDP and US Durable Goods will be watched for indirect impact.
- Q1 Earnings Season: The earnings season is in full swing, with more results expected from major companies next week. Key companies that reported today or are set to report soon include Reliance Industries, JSW Steel, Axis Bank, ICICI Bank, Wipro, L&T Finance, and HDFC Bank. The performance of the Financials sector will be keenly watched.
- Investor Expectations: A period of consolidation with a potential upward bias is expected in the medium term, supported by better rural and healthcare performance. The Indian rupee is expected to remain volatile within a range of 85.25 to 86.20. The Indian economy is projected to grow at 6.5 per cent in FY26, driven by low inflation, a healthy monsoon, and rising government capital expenditure, suggesting a positive medium to long-term outlook. However, near-term concerns from FII selling and global factors persist.
Final Takeaway
Friday, 18th July 2025, witnessed a significant decline in Indian equity benchmarks, driven primarily by disappointing Q1 earnings from financial sector heavyweights, persistent FII outflows, and a downgrade of Indian equities by Citi. The Nifty slipped below 25,000, and broader markets also experienced widespread weakness.
While Metal, Media, and IT sectors showed some resilience, the overall sentiment remained bearish. Despite robust domestic liquidity provided by DIIs and cooling retail inflation, global factors like US Fed policy uncertainty and rising crude oil prices continue to influence market movements.
Investors are advised to remain cautious, focusing on fundamentally strong companies and adopting a selective approach amidst the dynamic and volatile landscape of the Indian stock market.