Indian equities witnessed a sharp selloff on Thursday afternoon as the Sensex dropped over 1,150 points, or 1.45 per cent, falling to 79,297, while the Nifty50 breached the 24,000 mark, trading at 23,989. Weak global cues, profit booking, and derivative expiry-related volatility were the key factors behind the decline.

Sectoral performance

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Losses were broad-based, with sectors like Auto, Banking, IT, FMCG, and Energy falling between 0.5 and 2 per cent. In contrast, PSU Banks and Media stocks bucked the trend, gaining 0.5 per cent each.

The BSE Midcap index remained flat, while the Smallcap index outperformed, rising 0.4 per cent. Among the top Nifty losers were SBI Life Insurance, HDFC Life, Infosys, M&M, and HCL Technologies. Meanwhile, Adani Enterprises, Shriram Finance, SBI, and Cipla managed to stay in the green.

Expiry impact

Analysts attribute the market downturn to cautious sentiment ahead of the November derivative expiry and a lack of fresh triggers domestically. Additionally, subdued global markets and tech sector weakness, particularly in the U.S., added to the pressure.

Investors are advised to monitor key support levels of 23,900 on the Nifty50 while keeping an eye on global economic data for market direction. 

Vinod Nair, Head of Research, Geojit Financial Services, said, "Domestic markets took a breather after a strong start to the week. The overnight sell-off in the US market, driven by renewed uncertainty about the rate cut trajectory and rising geopolitical tension, led to a correction in heavyweight IT and consumer discretionary stocks. Conversely, the broader market outperformed the frontline index due to a shift in the stance of FIIs and investors seeking opportunities in undervalued stocks."