Indian stock markets face a sharp decline as Sensex and Nifty slump due to IT stock selloffs amid rising AI disruption fears and renewed global trade concerns.
Illustration: Dominic Xavier/Rediff
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- Indian stock market indices Sensex and Nifty fell sharply due to a selloff in IT stocks, fueled by fears of AI-led disruption.
- Rising crude oil prices and renewed global trade concerns, particularly related to US President Trump’s tariff policies, contributed to the negative market sentiment.
- IT stocks like Eternal, HCL Technologies, and Infosys experienced the most significant declines on the Sensex.
- Investors are closely watching US President Trump’s upcoming State of the Union address for further insights on trade policies.
- Foreign Institutional Investors (FIIs) were net buyers, while Domestic Institutional Investors (DIIs) were net sellers in the market.
Equity benchmark indices Sensex and Nifty slumped nearly 1 per cent in early trade on Tuesday, dragged down by a sharp selloff in IT stocks amid rising fears of AI-led disruption.
Rising global crude prices amid escalating US-Iran tensions and sluggish global cues also hit investor sentiment, traders said.
The 30-share BSE Sensex plummeted 1,068.74 points, or 1.28 per cent, to settle at 82,225.92.
During the day, the benchmark plunged 1,359.93 points, or 1.63 per cent, to hit an intraday low of 81,934.73.
The 50-share NSE Nifty fell 288.35 points, or 1.12 per cent, to close at 25,424.65.
In the intraday session, it depreciated by 385.4 points, or 1.49 per cent, to hit a low of 25,327.60.
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Global trade and tariff worries resurfaced as well, with additional pressure arising from Trump’s warnings on trade deals and reports of possible national-security tariffs, he added.
Tech Mahindra emerged as the biggest laggard, declining by 6.6 per cent, followed by HCL Technologies, Eternal, Infosys, Tata Consultancy Services, Larsen & Toubro, Trent, Bharti Airtel, HDFC Bank, Bharat Electronics Ltd and ICICI Bank.
On the other hand, NTPC, Hindustan Unilever, Tata Steel, PowerGrid, Titan, Reliance Industries, Axis Bank, and Sun Pharmaceuticals were among the gainers.
Broader indices also ended in the negative territory, with the BSE Smallcap Select Index falling 0.68 per cent, while the Midcap Select Index slipped 0.54 per cent.
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“Domestic markets registered a sharp decline, led by significant weakness in IT stocks amid renewed global concerns over AI-driven disruption and margin pressures for traditional service providers,” Vinod Nair, Head of Research, Geojit Investments Ltd, said.
Nair further said that realty stocks also came under strain on expectations that prolonged stress in the IT sector could weigh on real estate demand and valuations.
“Meanwhile, escalating US-Iran tensions, marked by embassy staff evacuations and Iran’s warnings of wider regional escalation, intensified risk aversion.
“Overall, markets remain highly sensitive to geopolitical risks and sector-specific pressures, driving investors toward defensive, domestically focused segments,” Nair said.
Global Markets and Tariff Concerns Impacted Indian Equities
In Asian markets, South Korea’s Kospi, Shanghai’s SSE Composite Index and Japan’s Nikkei 225 benchmark ended higher, while Hong Kong’s Hang Seng closed in red territory.
Brent Crude, the global oil benchmark, rose 0.22 per cent to $71.66 per barrel.
Foreign Institutional Investors (FIIs) bought equities worth Rs 3,483.70 crore on Monday, while domestic institutional investors were net sellers of stocks worth Rs 1,292.24 crore, according to exchange data.
