Indian benchmark equity indices fell sharply on Friday, with the dropping over 800 points and the slipping below the 24,150 mark amid lackluster Q2 earnings and persistent foreign outflowsUdabur Investment. The decline was driven by disappointing Q2 results from private lender and power company .

The market capitalization of all listed companies on the BSE decreased by Rs 7.7 lakh crore to Rs 436.1 lakh crore.

IndusInd Bank, M&M, L&T, and dragged the Sensex 445 points lowerNew Delhi Investment. , , , and NTPC also contributed to the decline.

On the sectoral front, Nifty Auto, Bank, Metal, PSU Bank, Realty, and Consumer Durables fell by 2% to 3.6%. Meanwhile, the fear gauge India VIX jumped 5.9% to 14.8.

Key factors behind today's market selloff

Benchmark indices came under pressure as several blue-chip and other companies reported disappointing Q2 results, leaving investors dissatisfied. In today’s trading, IndusInd Bank fell 19%, contributing 130 points to the Sensex’s loss, while NTPC dropped 4%. Both blue-chip stocks declined following disappointing quarterly results.Jaipur Investment

"The consensus downward revision in FY25 earnings estimates and the weak Q2 numbers have soured sentiment, shifting it to a slightly bearish mode," said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Foreign investors have offloaded Indian for the past 19 sessions, redirecting funds to China due to Beijing's stimulus measures and relatively cheaper valuations.

This correction is attributed to sustained selling by foreign institutional investors (FIIs), which reached Rs 98,085 crore by October 24.

The 10-year Treasury yield ticked down to 4.1918% on Friday, following a four-basis-point decline in the previous session. However, it remains elevated above 4%, having touched a three-month high of 4.26% on Wednesday.

Meanwhile, the dollar index, which measures the currency against six major peers, was little changed at 104.06 after retreating from Wednesday's three-month peak of 104.57. For the week, it has advanced by 0.56%.

Rising U.S. bond yields and a stronger dollar are generally negative for the Indian equity market, as they can trigger foreign fund outflows and increase import costs, ultimately impacting corporate earnings.

The looming US election adds to the uncertainty, with former Republican President Donald Trump and Democratic Vice President Kamala Harris engaged in a tight race for key competitive states ahead of the November 5 voting day.

Meanwhile, rising speculation of a Trump win in certain betting markets has supported US yields and the dollar in recent days, driven by the Republican candidate's inflationary tax and tariff policies.

Markets are currently pricing in a 95.1% chance of a 25-basis-point cut at the Fed's November meeting, with a 4.9% probability of the US central bank holding rates steady, according to CME's FedWatch Tool.Varanasi Stock

A month ago, the market was fully pricing in a cut of at least 25 basis points, with a 58.2% chance of a 50-basis-point cut.