Markets close lower; Banking Stocks underperformed

Markets witnessed a negative day of trade, with the benchmark index posting a huge selloff during the trade.

Bank Nifty underperformed the Nifty by 1.4% for the third consecutive trading session with both the indices closing ~3.4%/1.9% lower.

Banking stocks were among the top underperformers with stocks like HDFC Bank, SBI, Axis Bank & ICICI contributing to the majority of the loses along with an addition of heavy short positions during the day.

Nifty Midcap 100 index closed ~2% lower.

Market breadth ended in the favour of the declines with the advance/decline ratio closing at 1:4x. Bank Nifty saw an addition of short positions during the day.

On the options front (October 29, 2021 expiry), across the board writing was seen in the call option strikes as the Bank Nifty index trended lower. India Vix index closed at 17.9, up ~6%.