Nifty’s Worst Week in Seven Months

The past fortnight turned out to be a difficult one for domestic equity markets, reversing the optimism that had built up after Nifty’s eight-session rally in the previous period. The Nifty 50 suffered six consecutive days of losses, marking its steepest weekly fall in more than seven months. During the fortnight, the BSE Sensex slipped 1.8 per cent while the Nifty 50 declined 1.83 per cent. The broader markets were no exception, with the BSE Mid-Cap and BSE Small-Cap indices falling 3.11 per cent and 2.37 per cent, respectively.[EasyDNNnews:PaidContentStart]

Investor sentiment weakened amid the U.S.’ fresh blows to India’s IT and pharma sectors via steep visa fee hikes and a 100 per cent tariff on patented drugs

Adding to the unease, the Nifty VIX, often seen as the market’s ‘fear gauge,’ surged 12-13 per cent, signalling expectations of heightened near-term volatility. A combination of global and domestic triggers dampened investor sentiment. Among the most significant was the U.S. administration’s fresh offensive against India’s IT and pharmaceutical sectors. The U.S. government hiked H-1B visa fees to as high as USD 1,00,000, making it more expensive for Indian IT companies to hire or retain skilled workers in the U.S.

The development sparked a sharp sell-off in IT stocks, dragging the BSE Information Technology Index down by more than 7 per cent in just a week. Adding to the concerns, President Trump announced a 100 per cent tariff on imported branded and patented pharmaceutical products. Though analysts believe the direct impact on Indian pharma may be limited in the short term, the announcement unnerved investors, triggering a sharp decline in sectoral counters. The BSE Healthcare Index ended the fortnight lower by more than 4 per cent.

Sectorally, the weakness was broadbased. Beyond IT and healthcare, the auto sector too witnessed profit booking, following an impressive 40 per cent rally in the index from its April 2025 lows. Meanwhile, power and oil & gas indices were the only ones to buck the trend, though their gains were modest. On the capital flows front, foreign institutional investors (DII ">FIIs) continued their selling spree, pulling out nearly Rs 21,000 crore during the fortnight, a notable surge compared with the prior period.

Looking ahead, investors are keenly awaiting clarity on multiple fronts. The stalled India-U.S. trade negotiations, with Washington pushing New Delhi to scale back oil imports from Russia, remain a key overhang. At the same time, the upcoming Q2 earnings season is expected to play a decisive role in shaping market direction in the months ahead. Stay tuned for further updates!

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