Markets Dip as Rupee Plunges to Record Low - Banking and Auto Sectors Defy the Trend

Indian markets stumbled Tuesday as the rupee's historic collapse rattled investors—yet banking and auto stocks roared ahead against the tide.

Currency Carnage Meets Sector Strength

The rupee's nosedive to unprecedented lows sent shockwaves through equities, creating a bizarre divergence where traditional market logic gets tossed out the window. Banking giants and automotive manufacturers somehow absorbed the impact and posted gains that would make even seasoned analysts scratch their heads.

While currency traders watched their screens in horror, these two sectors executed a perfect bypass of the broader market panic—proving once again that in today's markets, fundamentals sometimes take a backseat to sector-specific momentum. Another day where the 'efficient market hypothesis' gets a good chuckle from the trading floor.

Banking, auto, metals lead sectoral gains

Banking stocks emerged as key contributors to the market’s recovery, with IndusInd Bank leading the gainers’ list, surging 2.82 per cent to ₹755.00, followed by Axis Bank, which gained 2.24 per cent to ₹1,170.00. Bajaj Finance ROSE 1.93 per cent to ₹1,025.90, while the banking pack’s strength was reflected in the Nifty Bank index, which gained 0.41 per cent.

Auto stocks stole the spotlight, rallying on robust Navratri sales under the new GST regime. The Nifty Auto index gained 0.62 per cent, with Maruti Suzuki rising 1.69 per cent to ₹16,083.00. “Carmakers such as Maruti Suzuki and Hyundai reported bumper bookings, as lower price points expanded affordability and drew in a fresh wave of buyers,” Hariprasad K observed.

Metals extended their winning streak, with JSW Steel gaining 1.87 per cent to ₹1,137.90, as the Nifty Metal index advanced 1.0 per cent. “Investors see sustained momentum in the sector as a potential driver of margin expansion in the coming quarters,” analysts noted, citing Optimism around firm demand and supply constraints from China.

Tech and consumer stocks underperform after H-1B hike

However, technology stocks faced pressure after the U.S. government’s hike in H-1B visa fees impacted sentiment. Tech Mahindra emerged as the top loser, declining 2.16 per cent to ₹1,472.90. Consumer goods stocks also witnessed profit-booking, with Trent falling 2.11 per cent to ₹4,905.00, SBI Life declining 2.01 per cent to ₹1,820.30, Hindustan Unilever dropping 1.84 per cent to ₹2,524.90, and Nestle India declining 1.72 per cent to ₹1,167.90.

“The Nifty remained range-bound, with strong support at 25,152–25,050 and resistance NEAR 25,259–25,400. A sustained move above 25,167 could pave the way toward 25,300–25,400,” said Ponmudi R, CEO of Enrich Money.

Broader markets underperformed for the second consecutive session, with the Nifty Midcap 100 declining 0.35 per cent to 58,496.60 and the Nifty Smallcap index falling 0.53 per cent. Market breadth remained negative with 2,453 stocks declining against 1,709 advances on the BSE, while 173 stocks hit 52-week highs and 66 touched 52-week lows.

“On the weekly expiry day, the benchmark Nifty index witnessed a volatile trading session. After slipping to an intraday low of 25084, the index staged a recovery in the latter half of the session,” observed Sudeep Shah, Head - Technical Research and Derivatives at SBI Securities.

Core sector output at 13-month high supports optimism

Core sector output provided a positive backdrop, surging to a 13-month high of 6.3 per cent in August, aided by robust steel and coal production. “8 Core industries’ strong production data underscores the resilience of the domestic economy, supporting optimism around external challenges,” said Vinod Nair, Head of Research at Geojit Investments Limited.

Looking ahead, technical analysts expect the Nifty to trade in a range of 25,100–25,400 in the near term. “The zone of 25,270-25,300 will act as an immediate hurdle for the index. Any sustainable MOVE above the level of 25,300 will lead to a sharp upside rally up to the 25450 level,” Shah added, while noting crucial support at the 25,080-25,050 levels.

Published on September 23, 2025