Indian equity markets saw a sharp drop in the afternoon trade, and the cut was deepened pulled lower by metal and tech stocks. The Nifty 50 fell more than 200 points or 0.95% to trade at 23,800, while the Sensex pulled back more than 700 points or 0.93% to trade at 76,400.

India’s volatility index is seeing a significant increase, rising 6.7% to a level of 13.71.

Even the five biggest losers on the Nifty 50 were the heavyweight IT and metal stocks: TCS, Infosys, Hindalco Industries, JSW Steel, and Wipro.

3 reasons why markets are falling today

Tech stocks crash 2%: Rout across global tech stocks

The tech stocks are under severe selling pressure. The Nifty IT Index is down 1.9%. Some of the biggest losers in the tech sector include names like Wipro, TCS, and Infosys, which were the three biggest losers among the tech stocks.

This rout across the tech sector follows the rout seen globally after the artificial intelligence and chipmaking sectors saw a significant pause. 

The technology-heavy Nasdaq 100 Futures tumbled nearly 2% to 30,062.50 points. S&P 500 Futures slid 1% to 7,462.75 points, while Dow Jones Futures fell 0.3% to 51,945.0 points.

The fall across the Asian markets was seen as soon as they started trading following the overnight slump in the US market. South Korea’s Kospi Index is down more than 6%, seeing sharp declines in heavyweight chipmakers.

“The US peace deal with Iran remains delicate, but investors seem to be too busy selling artificial intelligence stocks to notice. Tech was the main drag on markets, although small caps were a bright spot,” said Vikram Kasat, Head of Advisory at PL Capital.

European chipmakers are also seeing a sharp decline, while semiconductor equipment makers ASML and ‌Aixtron slipped more than 5% each.

Tech stocks in the region have been the biggest gainers among major sectors this quarter. However, as borrowing costs tick higher, corporates banking on debt-backed spending are likely to come under pressure. 

Dollar shoots up to 1-year highs

The US dollar has strengthened to its highest level in more than a year on expectations of a more hawkish Federal Reserve, despite oil prices inching lower on ebbing Gulf tensions, while the yen flirted with a four-decade low. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, inched ‌up to 101.13, its highest level since May 2025.

As per the most recent Reuters note, Fed funds futures are pricing in more than an 80% chance of a rate hike by September.

The fact that the Middle ​East conflict is not being totally resolved is also adding to the factors adding to the dollar’s strength. 

Metal stocks

The metals were the other big pocket, seeing significant selling pressure in the market today. Vedanta was the worst-hit stock in the Nifty Metal index, declining over 8%. It was followed by National Aluminium Company, Hindustan Zinc, Jindal Steel, NMDC, and many other metal stocks. 

The metal stock basket dropped the most among the sectoral indices, dropping 3.5%.

As the geopolitical tensions in West Asia are coming to an end, the demand for precious metals is declining. The price of Silver declined almost 5% on the back of a strong US dollar, dropping to the lowest point year-to-date. On the Multi Commodity Exchange, Gold for the 05 August 2026 contract stood at Rs 1,46,320 per 10 grams, lower by 1.21%.

This decline in safe havens led to a fall in metal stocks. 

Globally too, European ⁠mining shares fell 4.5%, tracking declines in precious metal prices.