Sensex falls over 200 pts, Nifty below 24,750 as IT stocks drag on tariff worries

Economic Times

6 days ago

Indian equity benchmark indices opened lower on Monday, as uncertainty over trade talks with the U.S. and weaker-than-expected earnings from Kotak Mahindra Bank dampened investor sentiment.
ADVERTISEMENT The BSE Sensex was down 326 points, or 0.4%, at 81,136, while the Nifty50 slipped 95 points, or 0.38%, to 24,736 around 9:18 am. However, the market recovered sharply, shedding the early losses. At 9:40, Sensex was down
From the Sensex pack, Kotak Mahindra Bank, Infosys, TCS, Bharti Airtel, HCL Tech, and Bajaj Finance were among the top laggards, falling up to 5.5%. In contrast, Tata Motors, Bajaj Finserv, UltraTech Cement, ICICI Bank, and Tata Steel opened with gains.
Kotak Mahindra Bank dropped 5.5% after the private lender reported a decline in first-quarter profit on Saturday, as higher provisions for potential bad loans and a contraction in lending margins weighed on performance.Meanwhile, heavyweight TCS fell nearly 1.5% in early trade after the company announced plans to reduce its workforce by 2%, roughly 12,200 employees, in FY26. The move comes as TCS adopts AI technologies, expands into new markets, and navigates an uncertain demand environment.
On the sectoral front, Nifty Realty dropped 2.3%, weighed down by losses in Lodha, Prestige, and Oberoi Realty. The Nifty Private Bank index also declined 1.1%, led by a sharp fall in Kotak Mahindra Bank. In the broader market, the Nifty Midcap 100 edged up 0.2%, while the Nifty Smallcap 100 slipped 0.1%.
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"Negative news and triggers have pushed the Nifty to a one-month low, and market sentiments continue to be unfavourable. While trade deals with Japan and EU, thought to be difficult initially, have happened, the much expected India-US trade deal is even now hanging fire. This has impacted market sentiments," said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments.
"FII selling of Rs 13552 crores in the cash market last week has added to the weakness in the market. Yet another concern is the Q1 results, which are not yet indicating any major positive surprises. Investors have to be cautious and stock-specific in this weak phase of the market," Vijayakumar added.
ADVERTISEMENT Mandar Bhojane, Senior Technical & Derivative Analyst at Choice Broking, said, "For any meaningful upside to resume, the index needs to decisively close above the 25,150 mark. A breakout above this level could open the door for higher targets around 25,500 and 25,700 in the upcoming sessions. Until then, the broader outlook remains sideways to bearish."
Global stocks rose and the euro firmed on Monday after a trade agreement between the United States and the EU lifted sentiment and provided some clarity in a week of key policy meetings by the Federal Reserve and the Bank of Japan.
ADVERTISEMENT S&P 500 futures rose 0.4% and the Nasdaq futures gained 0.5% while the euro firmed across the board, rising against the dollar, sterling and yen. European futures surged nearly 1%.MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.27%, just shy of the almost four-year high it touched last week. Japan's Nikkei fell 0.8% after hitting a one-year high last week.
ADVERTISEMENT Foreign Institutional Investors (FIIs) extended their selling streak for the 5th consecutive session, offloading equities worth Rs 1,979 crore on July 25. In contrast, Domestic Institutional Investors (DIIs) remained net buyers, investing Rs 2,138 crore into equities on the same day.
While the baseline 15% tariff will still be seen by many in Europe as too high, compared with Europe's initial hopes to secure a zero-for-zero tariff deal, it is better than the threatened 30% rate.