HDFC Bank wasn’t the only sentiment depressor on Thursday, sending the Nifty down 600 points. Auto pak, which has the fourth largest weightage in the benchmark index and accounts for 7%, was the worst sectoral loser, shedding 1,000 points or 4% intraday. All 15 stocks were trading in the red.
Big guns like Mahindra & Mahindra (M&M), Maruti Suzuki and Eicher Motors tumbled up to 5%. Other companies such as Bharat Forge, Samvardhan Motherson International, Tata Motors Passenger Vehicles (TMPV), Ashok Leyland, TVS Motor Company, Hero MotoCorp and Bajaj Auto also fell between 5% and 3%.
Auto ancillary counters such as Uno Minda, Bosch, Sona BLW Precision Forgings, Exide Industries and Tube Investments of India declined between 1% and 3%.
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The Nifty Auto index is down over 11% in a month and is among the worst hit sectors apart from banks and IT.
While financial services stocks have been the top movers based on their weighting (37.68%), oil, gas and consumables (10%) and information technology (8.84%).
While Nifty IT index was down 2.6%, Nifty Oil & Gas was down 1.5%.
Thursday’s decline follows the US Federal Reserve’s decision to hold policy rates at 3.50% to 3.75% on Wednesday. The rate-setting committee, by an 11:1 margin, voted to maintain the status quo in light of the Iran-Israel/US war, with inflation likely to rise again. Fed officials raised their 2026 inflation forecast to 2.7% from 2.4% due to Middle Eastern tensions.
Brent prices touched $116 a barrel today after an Iranian missile attack on Qatar’s main LNG processing operation at Ras Lafan.
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Energy prices are directly linked to sentiment around the automobile sector.
The war has now entered its 20th day and there are no signs of a ceasefire between the warring factions. To make matters worse, they have started targeting each other’s energy structures.
On the other hand, the Sensex fell 2,200 points or 3.8% to touch an intra-day low of 74,510.27. HDFC Bank, ICICI Bank and Larsen & Toubro (L&T) were the biggest laggards.
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