Equity market investors lost nearly Rs 12 lakh crore over the past three trading sessions as Dalal Street succumbed to intense bearish pressure. Weak Q1FY26 earnings and delays in the India-US trade deal have dampened investor sentiment, triggering a sharp sell-off. The benchmark BSE Sensex plunged 1,836 points (2.2%), while the NSE Nifty50 dropped 2.1% during this period.
The sentiments have further been weighed down by TCS’s announcement of 12,000 job cuts and a relentless selling by foreign institutional investors (FIIs). Data for this month, up to 25th July, shows a net FII sell figure of Rs 20,262 crores. On Monday, they offloaded (net sales) shares worth Rs 5,876.76 crore.
“Markets are currently grappling with headwinds on both domestic and global fronts. On the domestic side, earnings disappointments and persistent foreign fund outflows are dampening sentiment,” said Ajit Mishra – SVP, Research, Religare Broking.
Mishra added that in the banking space, earlier resilience had helped limit the decline but renewed pressure across the sector—except for heavyweights ICICI Bank and HDFC Bank—is adding to participants’ concerns.
Banking stocks came under severe pressure on Monday after Kotak Mahindra Bank plunged over 7% to close at Rs 1,966 following weak Q1 results. Other lenders, including IndusInd Bank, PNB, SBI, and Bank of Baroda, declined 1–3%. Mishra added that globally, uncertainty surrounding trade deals, despite strength in the US markets, is contributing to the cautious approach.
Vinod Nair, Head of Research, Geojit Investments, said that in contrast to domestic market performance, global markets remain broadly positive, supported by US-EU trade developments that are perceived as less concerning than anticipated.
“The upcoming monetary policy decisions from the Fed and BoJ, along with the trajectory of domestic quarterly earnings, are expected to play a pivotal role in shaping market direction in the near term,” he added.
The Sensex dropped 572 points, or 0.7%, to settle at 80,891, while the NSE Nifty 50 fell 156 points, or 0.6%, to 24,681. The Nifty Bank index slipped 444 points to 56,085. In the broader market, the Nifty Midcap 100 and Nifty Smallcap 100 indices extended their losing streak, ending lower by 0.84% and 1.26%, respectively, reflecting sustained risk aversion.
Investors have seen their wealth come down by over Rs 12 lakh crore in three days, as the market capitalisation of BSE-listed companies fell from Rs 460.35 lakh crore at the end of Wednesday (July 23) to nearly Rs 448 lakh crore on Monday (July 28).
Sector-wise, the Nifty Realty Index was the biggest laggard, falling 4%, followed by losses in banking, metal, IT, and defence indices, which dropped between 1% and 2%. Realty stocks such as Prestige Estates, Lodha, Godrej Properties, and DLF declined 3–6% on fears that job cuts at TCS may impact housing demand. IT majors like TCS, Wipro, LTI Mindtree, and Tech Mahindra were down 1–3%.
Sudeep Shah, Head - Technical and Derivatives Research, SBI Securities, said that for the third straight trading session, the benchmark index Nifty closed in the red, reflecting persistent bearish sentiment across the broader market. Shah added that one key development to note is the continued rise in India VIX, the volatility index, which climbed for the third consecutive session. From its recent low of 10.72, it has jumped nearly 12.5% in just three trading days, signalling a growing nervousness among market participants and a possible increase in short-term market volatility.