For the week ending 1 October, India’s major equity gauges recorded their steepest consecutive weekly drop in 25 years. The BSE Sensex slipped 1,986.04 points, a 2.68 % fall to 71,909.70, while the NSE Nifty 50 lost 718.55 points, or 3.10 %, settling at 22,421.95. The decline extended a losing streak that began in early August and marked the longest series of weekly losses since the early 1990s.
Broad market weakness and sectoral fallout
All major sectoral indices ended the week in negative territory except for the technology segment, which managed a modest 0.5 % gain. Consumer durables emerged as the biggest laggard, tumbling 6 %, while the auto index fell 5.8 %. Metals, fast‑moving consumer goods and public‑sector banks each shed more than 4 % of their value. Real estate, healthcare, infrastructure and oil‑&‑gas sectors also posted declines exceeding 3 %.
The mid‑cap and small‑cap segments continued their downward trajectory. The Nifty Midcap 100 slipped 3.5 %, extending its own losing run to four weeks, and the Nifty Smallcap 100 fell 3.3 % over the same period. Companies such as PB Fintech, Patanjali Foods, Vodafone Idea and Swiggy were among the most heavily weighted losers, dragging the broader indices lower.
Currency pressure adds to market strain
The Indian rupee faced renewed pressure during the trading week, moving closer to its historic low of 96.96 per U.S. dollar. By the close on 1 October, the rupee had weakened by 50 paise from its level a week earlier, ending at 96.32 against the greenback, after trading in a range of 95.74–96.32. The depreciation was attributed to a combination of higher Brent crude prices linked to renewed Middle‑East tensions, rising global bond yields and persistent outflows of foreign capital.
Institutional flows: foreign selling versus domestic buying
Foreign institutional investors (FIIs) intensified their divestment, marking a sixth straight week of net selling. Over the seven‑day period, they off‑loaded equities worth roughly ₹34,966 crore. In contrast, domestic institutional investors (DIIs) continued to provide a counter‑balance, buying equities valued at about ₹33,455 crore during the same timeframe.
The net effect of these flows, combined with the broader market sentiment, erased close to ₹15 lakh crore from the combined market capitalisation of companies listed on the BSE. Heavyweights such as Reliance Industries, Titan Company, Bajaj Finance and Bharti Airtel accounted for a sizable share of the erosion, while Kotak Mahindra Bank, Infosys and InterGlobe Aviation were among the few stocks that generated wealth for investors.
Analysts linked the market sell‑off to a mix of external and internal factors. Elevated crude oil prices, driven by geopolitical uncertainty in the Middle East, lifted input costs for many Indian firms. At the same time, global bond yields rose, making foreign assets more attractive relative to emerging‑market equities. The persistent outflow of foreign funds, coupled with a weakening rupee, compounded the pressure on Indian equities.
Despite the overall gloom, the technology sector managed a small upside, suggesting pockets of resilience amid the broader downturn. However, the prevailing trend indicated that investors remained cautious, awaiting clearer signals on inflation, monetary policy and geopolitical developments before committing fresh capital.
Market participants will be closely watching the upcoming week for any signs of reversal. Key variables include the trajectory of Brent crude, movements in U.S. Treasury yields, and any policy response from the Reserve Bank of India aimed at stabilising the rupee. The depth of foreign fund outflows and the ability of domestic investors to sustain buying pressure will also be critical in determining whether the market can break its extended losing streak.
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