India’s equity indices slipped early Friday, weighed down by financial stocks after Axis Bank’s disappointing quarterly earnings triggered market-wide caution.
Key equity benchmarks in India declined during early trading Friday, driven by widespread losses across sectors, most notably within the financial and private banking spaces. The downturn was spurred by a weaker-than-expected quarterly report from Axis Bank, one of India’s largest private sector lenders, causing significant ripple effects in market sentiment.
The Nifty 50 index was down 0.39%, trading at 25,013.70 points, while the BSE Sensex dropped 0.41% to 81,921.03, reflecting investor concerns after Axis Bank posted a surprise fall in net profit, attributed to a rise in bad loans stemming from an internal benchmarking adjustment.
Axis Bank shares slumped nearly 4%, marking its steepest intraday decline in six months. The bank emerged as the top loser among Nifty constituents and significantly weighed on the financial sector, which dropped 0.5%, and private banks, which slid 1.1%.
Broader indices also felt the pressure. Mid-cap stocks edged down 0.2%, and small-caps slipped by 0.1%, as cautious trading prevailed amid muted early earnings season performance.
Despite the downtrend, the IT sector remained relatively stable. Gains of nearly 3% in Wipro were neutralized by a 2% decline in LTIMindtree, reflecting a mixed response to the sector’s Q1 earnings updates.
“The initial earnings prints have been subdued, which is reflected in the risk-off tone in the market,” said a portfolio manager. The Nifty 50 and Sensex are both heading for a third straight week of losses, with weekly declines of 0.5% and 0.7%, respectively.
However, investor optimism remains intact for the longer term. Market watchers believe that expectations of a stronger corporate earnings recovery in the latter half of the fiscal year could provide much-needed support and limit further downside pressure.
In contrast to domestic market weakness, global cues remained favorable. Asian markets outside Japan posted gains following positive economic data from the United States, adding external support to otherwise subdued local sentiment.
As Indian investors brace for more earnings disclosures, particularly from the financial and FMCG sectors, market volatility may persist in the short term. However, the undercurrent of optimism for FY25’s second half remains a key anchoring force.