IT stocks couldn’t save Nifty as crude, Fed fears drag markets into red

The Nifty 50 and Sensex opened at 23,576.15 and 75,369.63 respectively, both indices gapping up before retreating sharply through the morning session. Information technology stocks initially led the gains, with HCL Technologies, TCS, Infosys, Tech Mahindra and TMPV all posting double-digit percentage increases. However, selling pressure in financials, industrials and consumer stocks overwhelmed the IT sector, resulting in a sharp reversal by midday.

The Sensex fell 134.29 points (0.18 per cent) to 74,647.47, while the Nifty slipped 81.05 points (0.35 per cent) to 23,317.05. The rotation in favor of IT stocks came after global reassessment of high-valuation technology stocks following concerns over the pace of AI development. Multiple sectors experienced losses, with Shriram Finance, BEL, Grasim, Adani Enterprises and Titan all recording declines.

Broad market breadth on the BSE confirmed the negative sentiment, with more stocks declining than advancing. Brent crude prices and geopolitical risks added to the negative market sentiment, with India's consumer price inflation rising to 4.82 per cent in August. The Federal Reserve's two-day FOMC meeting, which began on the day, remained the primary focus for market moves, with a 60 per cent probability of a 25-basis-point rate hike.