- Indian markets declined sharply with Nifty 50 down nearly 1% and Sensex losing 500 points.
- All sectors except IT and Media traded in the red, with Realty falling nearly 1.5%.
- Nifty IT posted its worst monthly decline since September 2008 in February 2026.
The Indian markets faced intense pressure during Friday's trade, with the Nifty 50 ending with cuts of nearly 1.3%, falling 100 points in five minutes to below 25,200. Sensex was also down over 1.18%, losing out on around 1,000 points.
Most sectors ended in the red, with Nifty Realty falling almost 2.3%, as of 3:30 pm.
However, more pain is witnessed in the broader market, with Nifty Smallcap 250 ending with cuts of almost 1.10%. Nifty Midcap 150 was also down around 1.14%.
Some key points to note here:
- Nifty logs a second week of decline
- Nifty over 1% lower for the week
- Nifty extends decline to third month
- Infosys, Tech Mahindra HCLTech worst performers for the month
- Power Grip, Apollo Hospitals, SBI top gainers for the month
Here are the key reasons dragging the markets on Friday.
MSCI Adjustments
The MSCI February 2026 index review, effective at the close of trading today, involves major rebalancing, resulting in a estimated net outflow of approximately $260 million.
Global index provider MSCI has announced the results of its February 2026 quarterly review, adding Aditya Birla Capital Ltd. and L&T Finance Ltd. to the MSCI Global Standard Index, while IRCTC Ltd. will be the only stock to exit the benchmark.
MSCI also confirmed that the weightage of AU Small Finance Bank Ltd. will increase following a float adjustment, a move that typically triggers passive inflows as index‑tracking funds rebalance their portfolios.
Broad-Based Decline
Key long-term technical levels breached for Nifty, and all sectors barring IT and Media are facing pressure, due to lack of positive triggers. Realty is seeing the most decline of nearly 2.3%, followed by Nifty Auto.
On the contrary, Nifty IT has recorded its worst monthly decline since September 2008, making February 2026 the index's weakest month on record. The slump also marks the worst start to a year for the sector since 2008, underscoring the sharp deterioration in sentiment toward Indian technology stocks.
Weak Global Cues
Asian stocks edged lower from record highs after Wall Street benchmarks retreated, as sentiment was dampened by the market's muted response to Nvidia Corp.'s earnings.
Wall Street stocks recovered from their session lows as oil prices reversed earlier gains amid signs of progress in US nuclear negotiations with Iran. Chipmakers, however, dragged the market lower after Nvidia Corp.'s results failed to provide the reassurance investors sought about the momentum of artificial intelligence. While the S&P 500 ended the day weaker, roughly 350 of its constituents advanced, showing underlying market resilience.
The Nasdaq 100 slipped 1.2%, and Nvidia shares tumbled 5.5% despite a bullish forecast, pulling nearly every company in a key semiconductor index down with it. Meanwhile, bonds climbed as investors shifted toward safer assets.
ALSO READ: Nvidia Shares Plunge Over 5% Even After Blockbuster Q4 Results; S&P 500, Nasdaq Drag
FPIs Sold Over Rs 3,000 Crore
Foreign portfolio investors turned net sellers of Indian equities on Thursday after a day of buying as volatility extends. The FPIs sold shares worth Rs 3,466 crore worth of stocks. However, domestic institutional investors stayed net buyers for the third day as they bought shares worth Rs 5,032 crore.
This week has seen high volatility with FIIs moving from buyers to sellers. In total so far this week FIIs have bought shares worth Rs 2,907 crore while the DIIs have bought equity worth Rs 12,020 crore.
Gaurav Udani - Founder, Thincredblu Securities, says “Today's markets are reflecting a classic risk-off setup. Weak global cues and profit-taking turned cautious sentiment into selling pressure, dragging Nifty lower by ~170 points. Heavyweights couldn't hold up, and volatility spiked as foreign funds stepped back. Technically, the index has broken immediate supports and the structure is showing lower lows, which invites momentum selling. If Nifty closes below 25,100, expect further downside acceleration as short-term players capitulate. The broader picture suggests markets are pricing in external stress and recalibrating risk, not a structural top — but caution remains warranted in the current environment.”
ALSO READ: FPIs Turn Net Sellers As Nifty Ends Flat After Sharp Intraday Moves
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