Sensex and Nifty News: Market Drops Over 600 Points as IT, Auto, FMCG Stocks Drag

Market Performance

Indian stock markets ended their two-day winning streak on May 27, witnessing a sharp sell-off led by IT, Auto, and FMCG sectors. The Sensex plummeted by 625 points, while the Nifty 50 slid below the 24,850 mark, reflecting broad-based weakness across industries.

• Sensex closed at: 81,551.63 (▼ 624.82 pts | -0.76%)
• Nifty 50 settled at: 24,826.20 (▼ 174.95 pts | -0.70%)

Despite the slump in frontline indices, the broader market held steady, with midcap and smallcap segments registering mild gains:

• Nifty Midcap 100: ▲ 0.15%
• Nifty Smallcap 100: ▲ 0.10%
• BSE Midcap: ▲ 0.18%
• BSE Smallcap: ▲ 0.19%

Overall market capitalization of BSE-listed companies declined slightly from ₹445 lakh Crore to ₹444 lakh Crore.

Main News

Key Reasons Behind the Market Fall

1. Weak Global Cues and Profit Booking
   • Asian markets, including Japan's Nikkei and Korea's Kospi, saw declines.
   • Concerns around the U.S. fiscal deficit impacted investor sentiment.
2. Decline in Foreign Capital Inflows
   • Foreign Portfolio Investors (FPIs) turned cautious.
   • On May 26, net FPI inflows stood at just ₹135.98 Crore.
3. High Valuations
   • Nifty 50's Price-to-Earnings (PE) ratio rose to 22.6, higher than its one-year average of 22.15.
   • The lack of earnings upgrades continues to concern market participants.
4. Geopolitical Uncertainty
   • Persistent global risks are driving a "sell-on-rise" approach among investors.
5. Lack of Fresh Triggers
   • In the absence of new positive developments, markets are struggling to maintain gains.
   • All eyes now shift to the Q4 GDP data (May 30) and RBI monetary policy (June 6).

Company Details

Gainers

• Jio Financial Services: ▲ 3.5%
  • Regulatory nod received for mutual fund operations via JioBlackRock JV.
• Other notable gainers on Nifty included:
  • IndusInd Bank
  • Sun Pharma
  • Trent
  • Adani Ports

Laggards

• UltraTech Cement
• ITC
• JSW Steel
• Tata Motors
• Axis Bank

Defence Sector Stocks Rally

• Mazagon Dock and GRSE surged up to 4%.
  • Boosted by a potential ₹44,000 Crore order for the Navy, including 12 minesweepers.

FirstCry (Brainbees Solutions)

• The stock declined nearly 6%.
  • Reported Q4 FY25 net loss of ₹111.5 Crore, up from ₹43.2 Crore in Q4 FY24 and ₹14.7 Crore in Q3 FY25.

IndiGo (InterGlobe Aviation)

• Fell over 2%.
  • Co-founder Rakesh Gangwal sold a 3.4% stake, worth up to ₹6,831 Crore via a block deal.

Summary of the Article

In the latest Sensex and Nifty news, Indian markets saw a steep decline after a brief rally. The Sensex dropped 625 points, while the Nifty closed below 24,850, dragged down by IT, FMCG, and auto stocks. While large-cap indices suffered, mid and small-cap stocks showed resilience.

Global uncertainties have impacted market sentiment, reduced foreign inflows, led to overvalued stocks, and created a lack of new positive triggers. Among individual stocks, Jio Financial Services rose on SEBI approval, while defense-related companies gained on expectations of large orders.

As volatility rises, with the India VIX up by 5.55%, market participants remain cautious ahead of crucial macroeconomic updates due later this week.