Sensex Falls Over 800 Points in a Volatile Week: 6 Key Highlights for Investors

Indian equity benchmarks ended the week with significant losses, amid rising geopolitical tensions and trade-related uncertainty. The market was dragged down by concerns over the India–U.S. trade relationship after U.S. President Donald Trump imposed a 25 per cent tariff on Indian goods, effective August 1, along with an additional unspecified penalty reportedly linked to India’s defence procurement from Russia. Investors also tracked Q1 FY26 earnings, while domestic economic data took a back seat.

For the week ended Friday, August 1, 2025, the S&P BSE Sensex declined 863.18 points or 1.06 per cent to close at Rs 80,599.91. The Nifty 50 index fell 271.65 points or 1.09 per cent to settle at Rs 24,565.35. The BSE Mid-Cap index dropped 1.79 per cent to Rs 45,155.79, while the BSE Small-Cap index fell sharply by 2.47 per cent to Rs 52,575.33.

Markets started the week on a weak note with the Sensex falling for the third consecutive day on Monday, shedding 572.07 points. However, Tuesday brought a temporary rebound due to value buying in Large-Cap and blue-chip stocks. Wednesday saw modest gains on strong Quarterly Results from L&T, while Thursday and Friday reversed those gains amid global tariff concerns and derivatives expiry volatility.

Economic Updates and PMI Data

Despite market losses, macro data showed strength. The IMF revised India’s growth forecast to 6.4 per cent for both FY26 and FY27, citing strong consumption and reduced tariffs. Inflation was revised down to 3.7 per cent for 2025. Manufacturing activity remained robust, with the July HSBC India Manufacturing PMI rising to 59.1, driven by strong new orders and marketing efforts.

Auto Sales Data Mixed in July

Monthly auto sales presented a mixed picture. Tata Motors dropped 2.17 per cent as total sales declined 3.98 per cent. Mahindra & Mahindra rose in volumes but fell 2.66 per cent on the stock exchange. Bajaj Auto and Maruti Suzuki reported modest gains in sales but fell marginally. TVS Motor Company gained 2.52 per cent as it recorded a 29 per cent sales growth. SML Isuzu fell 9.2 per cent despite an 18.6 per cent rise in sales, reflecting investor concerns. Ashok Leyland also posted an 8 per cent growth but saw a 1.92 per cent decline in stock price.

Stocks in Spotlight: Quarterly Results

Kotak Mahindra Bank declined 6.07 per cent after a 7 per cent fall in Q1 standalone profit. In contrast, L&T gained 4.25 per cent after posting a 30 per cent rise in consolidated net profit and a strong order book. Asian Paints rose 4.02 per cent with a 58.9 per cent jump in net profit. IndusInd Bank rallied 5.1 per cent despite weak results, as some analysts see value buying. Laurus Labs surged 1.62 per cent after reporting a 1,154 per cent jump in net profit, along with a major investment plan in Andhra Pradesh. Eicher Motors rose 1.78 per cent on solid earnings and sales growth at its CV unit.

Global Market Snapshot

Globally, euro zone inflation held steady at 2 per cent. China’s factory output remained weak, with PMI at 49.3. The U.S. Federal Reserve held interest rates steady for the fifth time, while Japan’s central bank maintained its rate at 0.5 per cent. U.S. oil inventories rose by 1.5 million barrels, reflecting weaker demand.

Outlook

With U.S.–India trade tensions flaring and global cues turning volatile, investor sentiment may remain fragile. Market participants are likely to focus on the remaining corporate earnings, global macroeconomic signals, and any updates on trade negotiations. Defensive sectors and dividend-paying large-cap stocks could attract attention in the near term.

Disclaimer: The article is for informational purposes only and not investment advice.