FINNIFTY Tanks Nearly 5%: Shriram Finance, REC Lead Broad-Based Sell-Off

In line with the sharp sell-off across Indian equities, the Nifty Financial Services Index (FINNIFTY) witnessed a significant decline on April 7, 2025. As of 12:19 PM, the index was down approximately 4.66%, trading at 23,620.90.

The fall mirrors broader concerns in the market triggered by global trade tensions and aggressive tariff policies from the U.S., which have sparked a risk-off sentiment among investors.

The FINNIFTY, which comprises 20 leading financial stocks listed on the National Stock Exchange (NSE), is a key benchmark for tracking the performance of India’s financial sector.

The index composition is heavily weighted toward private sector banks, which make up about 69.58% of its portfolio.

Public sector banks account for another 6.93%, while the remaining weight is distributed among financial institutions, housing finance companies, insurance firms, and other financial services providers.

Top Drags on the Nifty Financial Index

The steep fall in FINNIFTY was led by Shriram Finance, REC Ltd, and Cholamandalam Investment and Finance Company, each of which fell over 5%. LIC Housing Finance, ICICI Prudential Life Insurance, and Muthoot Finance also saw sharp losses, declining more than 4% each.

The drop in financial services stocks contributed significantly to the erosion of investor wealth, with the sector bearing the brunt of the global sell-off.

All You Need to Know About Fin Nifty? 

The Nifty Financial Services Index, popularly known as FINNIFTY, is a benchmark stock market index that reflects the performance of the top 20 financial companies in India. Launched in January 2021 by the National Stock Exchange (NSE),.

FINNIFTY includes a diverse mix of stocks from banks, insurance companies, housing finance firms, and other financial service providers. The index is calculated using the free-float market capitalisation method, which considers only the shares available for public trading, ensuring a realistic measure of market performance.

FINNIFTY serves multiple purposes—it is not only a reliable benchmark for evaluating the financial sector’s performance but also a popular foundation for launching index funds, exchange-traded funds (ETFs), and structured financial products. Additionally, it offers investors and traders the ability to participate through derivative instruments such as Futures and Options.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.