Sensex, Nifty Rebound After Worst Week; Metal & Banking Stocks Crash Up to 11%

The Nifty 50 rose 0.2% to 23,189, while the BSE Sensex gained 0.18% to 74,697.6 as of 10:08 a.m. IST. The modest recovery came after a sharp sell-off in the previous week, with market participants closely monitoring geopolitical developments and their potential impact on global energy supply and inflation.

Broad-Based Weakness Across Sectoral Indices

Despite the early gains in the headline indices, sectoral trends indicated widespread weakness across the market. Most sectoral indices traded in the red, reflecting cautious investor sentiment.

Realty, media, oil and gas, and consumption stocks led the decline, while IT, pharma, metals and banking stocks also remained under pressure. The broad-based selling suggested that investors were reducing exposure across both cyclical and defensive sectors amid uncertainty surrounding global interest rates, commodity prices and geopolitical tensions.

Sharp Decline in Metal Stocks in March

Metal stocks have been among the worst-performing sectors in March 2026. The Nifty Metal Index has declined by 7.29% during the month so far, reflecting profit booking after a strong rally and weakness in global commodity prices.

As of 11:37 a.m., the Nifty Metal index traded at 11,375.45 compared with its previous close of 11,292.50. 

Key Losers in the Metal Pack

Several metal stocks remained under pressure during the session.

Jindal Stainless Ltd opened at ₹706.90 and touched a high of ₹710.95 and a low of ₹674.15 before trading at ₹682.55. The stock declined ₹24.90 or 3.52% from its previous close of ₹707.45.

Hindustan Copper Ltd opened at ₹488.05 and moved between ₹494.80 and ₹472.50 before trading at ₹483.25. The stock fell ₹13.05 or 2.63% from its previous close of ₹496.30.

Steel Authority of India Ltd opened at ₹148.97 and traded between ₹150.13 and ₹144.29 before quoting at ₹146.29. The stock declined ₹3.60 or 2.40% from its previous close of ₹149.89. 

Banking Stocks Continue to Face Selling Pressure

Banking stocks have also witnessed sharp declines in March, with the Bank Nifty index falling nearly 11% during the month as investors reassess interest rate expectations and regulatory developments.

Among the major banking stocks as of 11:37 a.m., HDFC Bank traded at ₹832 after opening at ₹817.00. The stock touched a high of ₹833.50 and a low of ₹815.65 during the session. Compared with its previous close of ₹817.

ICICI Bank opened at ₹1,255 and traded between ₹1,258.30 and ₹1,240.10 before quoting at ₹1,248.70. The stock declined ₹6.10 or 0.49% from its previous close of ₹1,254.80.

State Bank of India opened at ₹1,048.70 and moved between ₹1,064.70 and ₹1,036.10 before trading at ₹1,051.80. The stock gained ₹4.80 or 0.46% compared with its previous close of ₹1,047.

Global Interest Rate Concerns Weigh on Markets

The decline in banking and metal stocks in early March is largely linked to the global interest rate outlook. Market commentary suggests that a rate cut at the upcoming US Federal Reserve meeting on March 18 is unlikely due to persistent inflation concerns. This has reinforced the “higher-for-longer” narrative for global interest rates.

Higher US yields tend to tighten global financial conditions and strengthen the US dollar against emerging market currencies. A stronger dollar also reduces the probability of aggressive monetary easing by the Reserve Bank of India and often leads to capital outflows from emerging markets.

RBI Policy and Regulatory Developments

Domestically, the Reserve Bank of India has maintained a cautious stance on monetary policy. As of the latest Monetary Policy Committee decision in February 2026, the repo rate stands at 5.25%, indicating that the central bank has not yet begun a strong easing cycle.

Additionally, the RBI has proposed stricter rules on how banks and non-banking financial companies bundle insurance products with loans. The proposal has triggered selling pressure in banking and insurance stocks as investors fear that such regulations could reduce fee-based income generated through cross-selling insurance products.

Why Banking Stocks Are Under Pressure

Banking and insurance stocks have declined as the market factors in potential pressure on non-interest income due to the RBI’s proposal on loan-linked insurance products. Investors are concerned that stricter regulations could reduce the profitability of cross-selling practices that have traditionally contributed to bank earnings.

The broader risk-off sentiment has further intensified the decline. Public sector banking stocks have seen sharper intraday corrections than the broader market, with examples such as Bank of India falling more than 5% in a single session earlier in March.

Higher global interest rates also create concerns about rising deposit costs for banks, potential mark-to-market losses on bond portfolios and lower valuation multiples as discount rates remain elevated.

Profit Booking and Dollar Strength Weigh on Metal Stocks

Metal stocks are facing pressure after a strong rally through late 2025 and early 2026. The Nifty Metal index had declined by 7.29% in March 2026, as investors booked profits at elevated levels.

The correction has been broad-based across the sector. Stocks such as Hindustan Zinc, Vedanta and NALCO have previously fallen between 4% and 7% in single sessions during the recent sell-off, while other counters, including Hindalco, Hindustan Copper and NMDC, have also witnessed declines.

Another major factor behind the weakness in metal stocks has been the retreat in global metal prices. Earlier in January 2026, copper, aluminium, gold and silver prices declined from recent highs, triggering one of the sharpest falls in the metal index since April 2025.

Stronger Dollar and Global Factors Add Pressure

A stronger US dollar ahead of key global central bank meetings has also weighed on metal stocks. Since most industrial metals are priced in US dollars, a stronger currency makes these commodities more expensive for global buyers and can reduce demand.

Company-specific developments have also added to the pressure. For instance, Hindalco had previously dropped nearly 6% in a single session when aluminium prices softened, and reports emerged about potential changes to US metal tariffs.

Repricing of Cyclical Sectors

The recent decline in banking and metal stocks reflects a broader repricing of cyclical sectors. Investors who had earlier bet on faster global rate cuts and stronger economic growth are now adjusting their expectations to a slower and more cautious monetary easing cycle.

In essence, sectors that had rallied strongly on hopes of lower interest rates and improving global demand are now giving back some of their gains as markets adapt to a “higher-for-longer” interest rate environment and ongoing geopolitical uncertainties.