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Market Dips on Global Tariff Worries, Sectoral Weaknesses Persist

By Mandar in Indian Market Insights —

Market Downturn on September 26, 2025

On September 26, 2025, Indian equity markets experienced a broad decline, with the Sensex and Nifty both closing significantly lower, extending a streak of losses.

  • The Sensex closed down approximately 766 points at 80,394.
  • The Nifty fell nearly 241 points, closing below 24,700.
  • This marked the sixth consecutive day of losses.

The market sentiment was negatively impacted primarily by global concerns about US tariffs and trade tensions.

Sectoral Performance

Sectoral indices generally declined by over 1%, with significant weakness in certain sectors.

  • Pharma: Pharma stocks were notably weak due to the US President's announcement of tariffs (100% on branded drugs and 25% on heavy-duty trucks).
  • IT: The IT sector was also adversely affected by trade-related uncertainties.
  • Metals: The BSE Metal index dropped around 1.6%, with major players experiencing losses.
    • Hindustan Zinc.
    • Vedanta.
    • SAIL.
  • Midcap and Smallcap: Midcap and smallcap indices extended losses beyond 2%, driven by profit booking and unwinding of long positions.
  • Nifty India Defence: The Nifty India Defence index showed a mild recovery of 0.19%.
  • Market Breadth: The market breadth indicated overall weakness.

Technical Analysis

Technically, the market showed signs of downward pressure.

  • The Nifty breached key support levels around 24,800-24,700.
  • Daily charts showed persistent lower highs and lower lows, indicating a potential continued correction.
  • Bank Nifty mirrored this trend.

Investor Actions

Investors are advised to take the following actions:

  • Monitor Support Levels: Watch key support zones at Nifty 24,600 and Sensex 80,000; breaches could increase selling pressure.
  • Exercise Caution with Specific Stocks: Be cautious with pharma and IT stocks due to tariff-related uncertainties.
  • Consider Defensive Sectors: Consider defensive sectors like FMCG and select PSU banks, which showed resilience.
  • Avoid Aggressive Positions: Avoid aggressive long positions in mid and small-cap stocks until the market stabilizes.
  • Watch Global Cues: Closely monitor global developments in US trade policy, as they will significantly influence the near-term market direction.

Overall Market Outlook

The market sentiment remains cautious, with a bias towards risk aversion due to geopolitical and trade policy concerns. Investors should maintain a balanced portfolio and adhere to strict risk management strategies due to ongoing volatility.