Markets slip early as bank stocks drag and foreign funds exit

Banking Losses and Foreign Selling Push Markets Into the Red

Written by: Supriya Kadu

Edited by: Pinky Deshmukh

Last Updated: December 02, 2025

Summary: Weak financials and fresh foreign withdrawals dragged on early trade, bringing Indian indices lower despite earlier strength.

The Indian stock market opened on a cautious note, with a weakening in important bank equities and the outflow of foreign funds unsettling investor confidence. Financials — a major backbone of the market — bore the brunt of the selling pressure. Banks were among the worst hit, and that immediately dragged down broader indices.

Foreign institutional investors (FIIs) are continuing to pull money out, worsening the fall. When large amounts are moved out, liquidity decreases, and investors become nervous, especially in areas that are already under pressure.

Even though there had been some upbeat momentum earlier, today’s session reflected how fragile sentiment remains. When bank stocks falter, or foreign flows turn negative, the ripple effects are quick and sharp.

As of now, the market is in a wait-and-watch mode — traders will be watching fund flows, banking-sector cues, and domestic macro data closely before picking their next move.