The Indian stock market experienced a significant downturn for the second consecutive day on Friday, July 25, 2025, with the Sensex plunging 721 points. The Nifty 50 also mirrored this decline, settling 225 points lower. This broad-based sell-off impacted various sectors, with mid- and small-cap segments experiencing even steeper losses.
The Sensex closed at 81,463.09, a drop of 0.88%, while the Nifty 50 ended at 24,837, down 0.90%. The BSE Midcap index decreased by 1.46%, and the Smallcap index crashed 1.88%. The Sensex had earlier hit an intraday low of 81,397.69, a fall of nearly 1%, while the Nifty 50 had dropped to 24,806.35.
Investors suffered substantial losses, with nearly ₹6.5 lakh crore being wiped out in a single day. The cumulative market capitalization of BSE-listed firms decreased to approximately ₹451.7 lakh crore from the previous session's ₹458.11 lakh crore. In the past two sessions, investors have lost nearly ₹9 lakh crore.
Several factors contributed to this market downturn. Weak corporate earnings and lackluster global cues triggered a broad-based sell-off across domestic equities. Elevated valuations in large-cap stocks, coupled with significant net short positions held by Foreign Institutional Investors (FIIs), added to the downward pressure. Uncertainty surrounding US-India tariff negotiations and the European Central Bank (ECB) holding steady on interest rates also contributed to fragile investor sentiment.
Barring Nifty Healthcare (up 0.69 per cent) and Pharma (up 0.54 per cent), all sectoral indices ended with losses. Media, Oil & Gas, PSU Bank, and Metal sectors were among the biggest losers. Nifty Bank and Financial Services also experienced declines. Bajaj Finance was particularly hard hit after posting weak quarterly numbers. A newly signed trade pact with the UK, which will lower duties on several goods, including whisky and cars, was also weighed by investors.
On a weekly basis, the Sensex and Nifty 50 have recorded losses for the fourth consecutive week. So far this month, both indices are down nearly 3% each. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 2,133.69 crore on Thursday, while Domestic Institutional Investors (DIIs) bought stocks worth Rs 2,617.14 crore.
