Pahalgam Terror Impact: Defence, Banking, and Auto Stocks Drag Nifty Down

Following the tragic terrorist attack in Pahalgam, Kashmir, on April 22, 2025, Indian financial markets have experienced significant volatility. The Nifty 50 index closed at 23,965.70, down 1.16% for the day. This downturn reflects heightened geopolitical tensions and investor apprehension. Here’s a detailed sector-wise and stock-specific analysis of today’s market performance

📉 Market Overview

• Nifty 50: Dropped 1.22%, closing at 23,950.15.

Sensex: Fell over 1,000 points, marking a significant downturn.

This decline is attributed to escalating geopolitical concerns, particularly the deteriorating relations between India and Pakistan following the Pahalgam incident. Investors are wary of potential retaliatory actions and their implications on market stability.​

🔍 Sector-Specific Impacts

1. Defence Sector

• Nifty Defence Index: Declined nearly 3%, with all 16 constituent stocks trading in the red.
• Key Stocks:
  • HAL (Hindustan Aeronautics Limited): Experienced a significant drop in share price.
  • MDL (Mazagon Dock Shipbuilders): Also saw a notable decline.
  • BEL (Bharat Electronics Limited): Shares fell sharply, reflecting investor concerns over potential defense-related escalations.

2. Banking Sector

• Nifty Bank Index: Underperformed the broader market, with a decline of over 2%.
• Key Stocks:
  • HDFC Bank: Shares fell by approximately 1.5%.
  • ICICI Bank: Experienced a decline of around 2%.
  • Axis Bank: Saw a drop of about 2.5%, making it one of the top losers in the sector. ​

3. Information Technology (IT) Sector

• Nifty IT Index: Declined by 1.5%, underperforming the broader market.
• Key Stocks:
  • TCS (Tata Consultancy Services): Shares fell by approximately 1.2%.
  • Infosys: Experienced a decline of around 1.5%.
  • HCL Technologies: Saw a drop of about 1.8%.
  • Wipro: Shares fell by approximately 2%.​

4. Automobile Sector

• Nifty Auto Index: Declined by 1.2%, with major stocks under pressure.
• Key Stocks:
  • Maruti Suzuki: Shares fell by around 1.5%.
  • Mahindra & Mahindra: Experienced a decline of approximately 1.3%.
  • Tata Motors: Saw a drop of about 1.7%.

5. Energy Sector

• Nifty Energy Index: Declined by 1.1%, with key stocks facing pressure.
• Key Stocks:
  • Reliance Industries: Shares fell by approximately 1.2%.
  • NTPC Limited: Experienced a decline of around 1%.
  • Power Grid Corporation: Saw a drop of about 1.5%.​

🧭 Investor Sentiment

Retail investors and High Net-Worth Individuals (HNIs) have turned bearish on Nifty and Bank Nifty index futures, marking their first shift in over six months. Analysts suggest that the markets are nervous due to the developing geopolitical situation with Pakistan after the Pahalgam attack. Investors are keeping their positions light and awaiting clarity on the India–Pakistan geopolitical situation.