Sensex Drops 600 Points as IT Selloff and Heavyweight Drag End Winning Streak

The Indian equity markets faced a sharp reversal on Friday, snapping a five-session winning streak as geopolitical concerns and a massive selloff in technology stocks weighed heavily on investor sentiment. While the Nifty50 managed to hold the 24,000 mark, the BSE Sensex plummeted by over 600 points, reflecting a significant intraday correction.

IT Sector Bloodbath Triggered by Global Headwinds

The primary catalyst for the market decline was a brutal selloff in the technology sector. The Nifty IT index emerged as the day's worst performer, plunging more than 6% to reach its lowest level since April 2023. This downturn was largely triggered by a weak growth outlook from US-based consulting giant Accenture.

Accenture’s decision to lower its FY26 revenue growth forecast to 3-4%—down from its previous guidance of 3-5%—sent shockwaves through Dalal Street. Investors feared that a reduction in discretionary spending by US corporations could directly impact Indian IT majors. Among the domestic players, Infosys saw a massive slide of nearly 9%, while Tata Consultancy Services (TCS), HCLTech, and Tech Mahindra all registered significant losses ranging between 2% and 6%.

Heavyweights HDFC Bank and Reliance Pull Indices Down

The market decline was not limited to the IT sector. Major index heavyweights HDFC Bank and Reliance Industries (RIL) also faced selling pressure, compounding the losses for both the Sensex and Nifty50.

HDFC Bank shares dropped by 2.25% to close at Rs 781. This decline was largely technical, as the stock began trading ex-dividend for a final dividend of Rs 13 per share. However, the bank remained in focus as the RBI approved a three-month extension for Keki Mistry's tenure as interim part-time chairman.

Meanwhile, Reliance Industries closed down 1.25% at Rs 1,311.50. Despite Chairman Mukesh Ambani outlining a future roadmap at the 49th AGM and announcing the upcoming filing of the draft red herring prospectus for the Reliance Jio Platforms IPO, the stock's downward movement contributed significantly to the Sensex's 607.08-point fall.

Market Summary and Volatility

The volatility during the session was notable, with the Sensex intraday decline reaching as high as 940.26 points before settling at 76,802.90. This correction follows an exceptionally strong run; over the previous five trading days, the Sensex had gained 4.84% (3,577.43 points) and the Nifty had advanced 4.34% (1,006.4 points).

Other notable losers included Mahindra & Mahindra and Hindustan Unilever, as the market processed both global macroeconomic signals and domestic corporate developments.

Key Takeaways

  • IT Sector Crisis: Global concerns over reduced IT spending, sparked by Accenture's lowered growth guidance, led the Nifty IT index to its lowest level in over three years.
  • Heavyweight Pressure: The selloff was exacerbated by declines in index heavyweights HDFC Bank (impacted by ex-dividend trading) and Reliance Industries.
  • End of Bull Run: The sharp correction snapped a five-session winning streak, wiping out a significant portion of the gains seen during the previous week.