Sensex Slumps 600 Points as Bank Earnings Miss Estimates

Indian benchmark indices, SENSEX and NIFTY50, faced significant downward pressure during Monday's session, triggered by escalating geopolitical tensions in the Middle East. Global sentiment soured after military actions between the United States and Iran stoked fears over crude oil volatility, with prices surging past $91 per barrel. This macroeconomic uncertainty, combined with investor caution, dragged the SENSEX down over 600 points to trade below 77,550 in the afternoon session.

The decline was primarily driven by private sector lenders, as market participants reacted to mixed June quarter (Q1 FY27) earnings reports. HDFC Bank shares plummeted after reporting a revenue drop, despite a 5% standalone profit increase. Similarly, Axis Bank shares declined following their latest financial disclosure, even with a 22.5% rise in profit. Conversely, Punjab National Bank bucked the trend, reporting a massive 213% surge in net profits, which fueled a notable jump in its share price throughout the trading day.

Other heavyweights experienced divergent movements, with Reliance Industries hitting an intraday high following record quarterly core profits. UltraTech Cement also reported a 17.2% rise in net profit, demonstrating resilience in the infrastructure and manufacturing space. Additionally, companies like VA Tech Wabag saw gains on the back of major domestic infrastructure contracts, while Tata Technologies faced selling pressure after a sequential profit decline. Analysts remain focused on how these earnings trends evolve as the broader market grapples with high energy costs and potential monetary policy shifts.