Sensex Slumps 670 Points, Nifty Below 24,200; Banks Lead Losses

Markets Open Deep in Red

Indian benchmark indices opened sharply lower on Monday, with the BSE Sensex plunging over 670 points and the NSE Nifty50 slipping below the 24,200 mark in early trade. The sell-off was broad-based, but banking stocks took the hardest hit.

By mid-morning, the markets had recovered some ground. The Sensex was trading around 400 points down, while the Nifty hovered near 24,200. Traders described the session as volatile, with sharp intraday swings.

Banking Stocks Under Heavy Fire

Axis Bank and HDFC Bank were the top drags on the indices, each shedding nearly 5% in early deals. The sell-off came after both lenders reported their quarterly results for the first quarter of the financial year.

Investors appeared disappointed with the numbers, though analysts remained split on the impact. The steep fall in these heavyweight stocks pulled the Nifty Bank index sharply lower, dragging the broader market with it.

Crude Spike Adds Pressure

Adding to the gloom, global crude oil prices surged overnight, stoking fears of higher import costs and inflationary pressure. The spike weighed on sentiment across sectors, particularly for oil-dependent industries and those with high fuel costs.

Market participants said the combination of weak quarterly results from key lenders and rising input costs created a perfect storm for the opening bell. Broader Asian markets also traded mixed, offering little support.

Partial Recovery, But Caution Remains

By late morning, the Sensex had trimmed its losses to about 400 points, while the Nifty managed to claw back above the 24,200 level. However, analysts warned that the recovery could be short-lived if selling pressure persists in banking stocks.

Traders reported increased volatility, with stop-loss triggers being hit across several counters. The market breadth remained negative, with more stocks declining than advancing on both the BSE and NSE.

Foreign institutional investors were net sellers in the previous session, and domestic institutions stepped in to absorb some of the selling. The rupee also weakened against the dollar, adding to concerns about capital outflows.

What to Watch

All eyes will now be on how the banking sector performs in the coming sessions. With more quarterly results due from other lenders, any further disappointments could deepen the correction. Crude oil prices and global cues will also dictate the near-term trajectory.