NSE Market Valuation, Expiry Turnover Down Amidst Jane Street Ban

The Nifty is headed for its second straight weekly loss, with expiry day turnover taking a hit due to SEBI's temporary trading ban on global firm Jane Street. Tata Consultancy Services (TCS) reported a decline in sales, sparking concerns about India's IT sector outlook. Defense stocks may benefit from large order wins and geopolitical uncertainty, while utilities stocks could rebound with improving power demand.

The Nifty is on track for its second consecutive weekly loss, with expiry day turnover significantly impacted by SEBI's temporary trading ban on global firm Jane Street. This development has sparked concerns about the stability of India's derivatives market and the broader IT sector outlook.

SEBI's surveillance on the derivatives market is being tightened following allegations against Jane Street for manipulating index levels. The regulator has not ruled out the possibility of revisiting the structure of weekly expiries but has no intention of curbing them at this stage [1]. SEBI's focus is on protecting retail investors and upgrading its surveillance tools to prevent market distortion. The regulator has characterized the Jane Street episode as primarily a surveillance problem, indicating that better early-warning systems could have prevented the extent of market distortion observed on expiry days [1].

Tata Consultancy Services (TCS) reported a decline in sales for the first quarter through June, which has raised concerns about the outlook for India's IT sector. While fears over US tariff-led slowdown have eased, demand remains flat, and revenue growth is expected to be modest and uneven [3]. The divergence between tier-1 and tier-2 IT companies is likely to persist, with large-caps like Infosys and LTIMindtree leading growth, while companies like Wipro, HCL Technologies, Tech Mahindra, and TCS are expected to report a drop due to seasonality and client-specific challenges [3].

Defense stocks may benefit from large order wins and geopolitical uncertainty, while utilities stocks could rebound with improving power demand. The sector is closely watched as SEBI seeks to restore trust in one of the world's most active equity derivatives markets. The regulator's next steps, particularly in terms of structural reforms, surveillance upgrades, and potential scrutiny of other trading strategies, remain closely watched [1].

References:
[1] https://economictimes.indiatimes.com/markets/stocks/news/jane-street-probe-sebi-chief-tuhin-kanta-pandey-rules-out-weekly-expiry-ban-signals-tighter-derivatives-watch/articleshow/122294946.cms
[2] https://www.bloomberg.com/news/articles/2025-07-11/india-s-hcl-technologies-tech-mahindra-lift-veil-on-it-industry-outlook
[3] https://www.livemint.com/market/mark-to-market/it-seasonally-strong-q1-won-t-sparkle-this-time-infosys-wipro-hcl-tech-mahindra-oackaged-goods-tata-revenue-growth-ai-11751781897630.html