Indian Stock Markets Drop Over Rs 1.3 Lakh Crore in Broad-Based Selloff

Indian equity markets witnessed a sharp decline on Friday, erasing gains from a five-day rally and wiping out over Rs 1.3 lakh crore in investor wealth. The Sensex fell more than 800 points, while the Nifty dropped below the 23,950 mark.

The selloff began in information technology stocks after Accenture's disappointing earnings and quickly spread across sectors. Market experts attribute the correction to a combination of factors: foreign investor selling, profit booking, global uncertainty, and geopolitical tensions.

Accenture's Guidance Triggers IT Rout

The Nifty IT index plunged nearly 6 per cent intraday, making it the worst-performing sector. Heavyweights such as Infosys, TCS, Tech Mahindra, HCL Technologies, and Mphasis fell between 5 and 8 per cent. The trigger was Accenture's reduction of its fiscal 2026 revenue growth guidance to 3-4 per cent from the earlier 3-5 per cent, and a fourth-quarter revenue forecast below analyst expectations. This revived concerns about delayed discretionary technology spending by global companies, particularly affecting Indian IT firms that derive significant revenue from North America.

Foreign Investors Turn Sellers Again

After three days of net buying, foreign institutional investors (FIIs) sold equities worth Rs 1,025 crore on Thursday, according to provisional data. This reversal added to market nervousness, as FIIs have been pulling money from Indian equities this year, preferring markets with more attractive valuations and fluid interest rate expectations.

Profit Booking and Global Cues Add Pressure

The five-day rally had lifted the Sensex by nearly 5 per cent and the Nifty by over 4 per cent, leading to profit booking as key technical resistance levels approached. Traders who bought aggressively during the rally appeared unwilling to chase higher prices without fresh triggers. Weak global cues, with Asian markets like South Korea's Kospi and Hong Kong's Hang Seng falling nearly 2 per cent each, added to the selling pressure.

Despite the sharp decline, domestic institutional investors continue to provide support, but the broad-based risk-off mood snapped the market's longest winning streak in weeks. The total market capitalisation of BSE-listed companies fell from Rs 4,77,60,908 crore to Rs 4,76,38,963 crore in two hours.