NIFTY Bank nosedives over 1,800 pts on March 19; what is behind the crash?

Both the benchmark indices, S&P BSE SENSEX and NSE's NIFTY 50, were trading over 2% lower at the time of writing this report.

Banking and financial stocks were reeling under pressure. The NIFTY Bank tumbled as much as 1,888.8 points, or 3.41%, during the day.

The top drag on the NIFTY Bank as well as the NIFTY 50 index was HDFC Bank. Shares of HDFC Bank slipped as much as 8.66% to hit a low of ₹770 apiece on the NSE.

Next on the losers' list were Axis Bank, ICICI Bank, SBI, and Kotak Mahindra Bank – all down up to 3%.

HDFC Bank shares tumble as Atanu Chakraborty resigns

Shares of HDFC Bank tumbled nearly 9% in the opening deals on Thursday, March 19, after the private sector banking giant late on Monday informed stock exchanges that Atanu Chakraborty had, on March 18, 2026, tendered his resignation as the part-time chairman and independent director of the bank with immediate effect, for reasons mentioned in the resignation letter.

Chakraborty, in his resignation letter, said, "Certain happenings and practices within the bank, which I have observed over the last two years, are not in congruence with my personal values and ethics."

“We confirm that there are no reasons other than those mentioned in the said letter for the resignation of Mr Chakraborty. Further, Mr Chakraborty does not hold directorship in any other company," the filing added.

HDFC Bank further said that based on an application made by the bank in this regard, the Reserve Bank of India, on March 18, 2026, has granted its approval for the appointment of Keki Mistry as an interim part-time chairman of the bank with effect from March 19, 2026, for a period of 3 months.

HDFC Bank has the highest weightage on NIFTY Bank index. As per the NSE press release dated February 27, 2026, HDFC Bank has 19.69% weight on the index.

Other financial stocks tumble too

Following the sharp slide in HDFC Bank, other banking stocks also took a hit. All leading names, ICICI Bank, Axis Bank, and State Bank of India, declined in the trade.

Overall market sentiment remains fragile

Brent crude, the global oil benchmark, jumped 3.77% to $111.4 per barrel.

Analysts note that Brent crude has surged to around $111 per barrel, which is negative for oil and gas importers such as India. If prices remain above $110 for a prolonged period, it could have adverse implications for the country’s macroeconomic stability.

Markets have been highly volatile amid ongoing developments on the war front and fluctuations in crude prices, one analyst said.

In Asia, key indices including South Korea’s Kospi, Japan’s Nikkei 225, China’s SSE Composite, and Hong Kong’s Hang Seng were trading sharply lower, while US markets ended significantly lower on Wednesday.

Another analyst said investor sentiment has weakened considerably following the sharp rise in crude oil prices, as escalating tensions in the Middle East and reported attacks on key energy infrastructure have heightened concerns over potential supply disruptions.

FII sell-off

Foreign Institutional Investors (FIIs) offloaded equities worth ₹2,714.35 crore on Wednesday, according to exchange data, while Domestic Institutional Investors (DIIs) remained net buyers, purchasing stocks worth ₹3,253.03 crore.

Analysts noted that continued FII selling reflects a clear risk-off stance, with sustained capital outflows weighing on overall market stability.