Indian Market Dips Amidst US Fed Concerns and Mixed Earnings; Pharma, Financial Stocks Lead Losses

Indian stock markets experienced a significant downturn on Thursday, with the Nifty 50 index falling by 176 points to close at 25,878 and the Sensex dropping 593 points to 84,404. The market breadth indicated more declining stocks than advancing ones. The Nifty Bank index also slipped, losing 354 points to 58,031, and the midcap index saw a decline of 53 points, closing at 60,096.

Major contributing factors to the fall included comments from US Federal Reserve Chair Jerome Powell, which dampened expectations for further US interest rate reductions in 2025. This global sentiment, along with mixed domestic earnings reports and the F&O expiry, added to the market volatility. Pharmaceutical stocks were among the top laggards, with Dr Reddy’s Laboratories experiencing a notable fall due to semaglutide development concerns. Cipla also declined after its CEO announced his resignation.

Conversely, Coal India emerged as a top gainer, rising nearly 2% on strong coal prices. Larsen & Toubro closed in positive territory following optimistic management commentary.

Reactions to quarterly earnings varied. PB Fintech surged 7% after exceeding expectations across the board. Bharat Heavy Electricals Limited, Aditya Birla Capital, and Canara Bank all saw gains of 3–7%. However, LIC Housing Finance fell after missing its estimates, and Union Bank of India closed lower despite reporting in-line results.

Vodafone Idea and Indus Towers saw declines following the Supreme Court's AGR order, while Indian Energy Exchange dropped as a market coupling case was deferred. Varun Beverages declined on mixed post-earnings commentary.

Impact: This news has a significant impact on the Indian stock market, influencing overall investor sentiment and leading to broad-based selling pressure, especially in interest-rate sensitive sectors. The performance of key indices and specific companies directly affects investor portfolios and market capitalization. Rating: 7/10

Difficult terms used: Nifty: A benchmark Indian stock market index that represents the weighted average of 50 of the largest Indian companies listed on the National Stock Exchange. Sensex: A benchmark index of 30 well-established and financially sound companies listed on the Bombay Stock Exchange. Market breadth: A measure of the number of stocks advancing versus declining, indicating the overall health and direction of the market. Advance-decline ratio: The ratio of the number of stocks that have advanced to the number of stocks that have declined over a given period. Nifty Bank index: A sector-specific index that represents the banking sector of the Indian stock market. Midcap index: An index that tracks the performance of mid-sized companies in the stock market. Laggards: Stocks or sectors that perform worse than the broader market. Semaglutide: A medication used for type 2 diabetes and chronic weight management. AGR order: Adjusted Gross Revenue order, related to telecom revenue definitions for license fees and spectrum charges. Market coupling case: A regulatory process aimed at integrating trading of electricity across different power exchanges. Q2 beat: A company's second-quarter earnings performance that exceeded analysts' expectations. In-line quarter: A company's quarterly earnings performance that met analysts' expectations. F&O expiry: Futures and Options expiry, the date on which derivative contracts must be settled or closed out.