Major Indian indices finished Wednesday in the red, led by steep declines of about 2% across both the Nifty IT and Oil & Gas sectors. Despite the initial drop of nearly 1,000 points on the Sensex, the broader market showed unexpected strength as auto, media, and pharmaceutical shares rebounded. In addition, the Indian rupee depreciated by 11 paise against the US dollar to settle at 95.23.
Key points
Institutional investors provided underlying market support as foreign and domestic funds…: Institutional investors provided underlying market support as foreign and domestic funds recorded net equity purchases of ₹871 crore and ₹643 crore, respectively.
Sector performance showed strong divergence, with auto stocks advancing 1.4% while the IT…: Sector performance showed strong divergence, with auto stocks advancing 1.4% while the IT and energy sectors each fell around 2%.
Rising oil prices and currency depreciation against the US dollar heightened domestic inf…: Rising oil prices and currency depreciation against the US dollar heightened domestic inflation concerns ahead of the US Federal Reserve's rate decision.
Sources checked by our analysis pipeline: 1
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The Sensex fell 352.6 points, or 0.48%, to close at 73,246 after plunging as much as 995 points, or 1.35%, to 72,603.5 during the session. The Nifty declined 50.90 points, or 0.22%, to settle at 22,699. Both indices had fallen as much as 1% earlier in the day.
Investor sentiment remained cautious as Brent crude prices climbed following an attack on a Saudi Arabian refinery. The global oil benchmark rose 1% to $114.50 a barrel, adding to concerns over inflation and its potential impact on India's economy and corporate earnings. Markets also awaited the outcome of the US Federal Reserve's policy decision.
IT stocks plunged amid global optimism around AI-linked stocks. South Korean chipmakers led a broader recovery in AI-related stocks after SK Hynix reported a sevenfold jump in profit and announced an additional $45 billion in shareholder returns. Among Asian markets, South Korea's Kospi was up 6.6%, Japan's Nikkei 225 was up 1.08%, Shanghai's SSE Composite and Hong Kong's Hang Seng indices also traded in positive territory.
Unofficial trading indicators show diverging investor expectations across four ongoing public offerings concluding their bidding cycles. Strong sentiment is currently favoring BLS Polymers with high double-digit listing expectations, whereas SFC Environmental Technologies is seeing the most muted debut projections. These unofficial premiums reflect initial appetite ahead of formal exchange trading, though they carry no official price guarantees.
Investor enthusiasm for artificial intelligence faced a sharp reality check after massive spending undermined megacap tech valuations, triggering broad sell-offs across regional bourses. Compounding the pressure, market participants are navigating diverging global interest rate trajectories alongside renewed diplomatic efforts in the Middle East. These combined crosscurrents are prompting traders to reassess risk exposures ahead of crucial United States inflation data.
The city's de facto central bank mirrored American borrowing costs to maintain its currency peg within the established 7.75 to 7.85 band. Local policymakers warned that upcoming shifts in borrowing costs remain unpredictable due to broader American economic data. These impending adjustments could soon sway financial conditions and interbank liquidity across the territory.