- The BSE Sensex closed at 81,186 down by 2.90%, and the Nifty 50 closed at 24,768, down by 2.93% in July 2025, driven by weaker-than-expected Q1 earnings heavy FPI outflows, and US–India trade tensions over a 25% tariff on Indian goods.
- Mid-cap and small-cap indices fell by 3.9% and 4.4% respectively, with most major indices slipping below their 50-day moving average.
- The advance-decline ratio on the BSE stood at 1,256 advances against 2,881 declines, with 162 stocks remaining unchanged, reflecting broad-based market weakness.
- Sectors such as FMCG, chemicals, and cement showed early signs of recovery, while the IT sector may benefit from a weaker rupee despite ongoing demand challenges.
- US President Donald Trump’s decision to impose a 25% tariff on Indian goods is expected to hurt export-oriented sectors such as pharmaceuticals, auto ancillaries, and select industrials, while also potentially impacting GDP growth and capital inflows if maintained for a prolonged period.
- Global sentiment was pressured as the US Federal Reserve kept interest rates steady at 4.25–4.50% and gave no clear signal of rate cuts, keeping the US dollar and bond yields elevated.
- India Inc.’s Q1 earnings have been mixed, with limited support to market sentiment. The IT sector continues to face demand-side pressures, while banks’ net interest margins have declined following the RBI’s rate cuts.
- Foreign portfolio investors sold equities worth approximately Rs. 42,000 crores during the month, while domestic institutional investors (DIIs) remained net buyers, partially offsetting the outflows.
Acknowledgements:
RBI Bulletin (www.bulletin.rbi.org.in), SEBI (www.sebi.gov.in), NSE (www.nseindia.com), BSE (www.bseindia.com)
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