Markets dip 1.5% after MSCI rebalances its India Index

Foreign investors sold Indian stocks after MSCI, the financial services whose indices serve as benchmark for global investors, replaced four major stocks with five others in the index. The rebalancing pulled the benchmark Nifty 50 and Sensex by over 1.5% on Friday (May 29, 2026).

MSCI announced that Hyundai Motors, Kalyan Jewellers India, Rail Vikas Nigam and SBI Cards and Payment would be removed from the India Domestic Index. Adani Energy Solutions, Federal Bank,  Hitachi Energy India, Multi Commodity Exchange of India and National Aluminium Co would be added in their place, according to a statement on May 12, 2026. 

Markets opened at 23,902.15 points and moved 100 points to cross 24,000 points by 12 noon before crashing to the day’s low of 23,484.75 after which it closed at 23,547.75 points. 

The rebalancing is expected to have led to a nearly $800 million to $1 billion in foreign investment outflow, said U.R. Bhat, a veteran investor and Co-founder of Alphaniti Fintech. Further he said that this was a large amount of outflow in a session and the rest of the retail investors who may not have known about the rebalancing exercise might have sold putting further downward pressure on the market.