Sensex, Nifty Trade Lower As IT Stocks Weigh; Investors Eye Monsoon, Fed Outlook

Indian benchmark indices traded marginally lower on Tuesday as investors booked profits after a strong rally in recent sessions, while weakness in information technology stocks offset support from lower crude oil prices and easing geopolitical tensions in West Asia.

At around 9:17 am, the BSE Sensex was down 168.59 points, or 0.22%, at 76,925.48, while the NSE Nifty 50 slipped 46.40 points, or 0.19%, to 24,056.50.

The benchmarks have rallied sharply in recent sessions, with the Nifty and Sensex gaining 4.1% and 4.4%, respectively, over the last seven trading days, aided by falling crude oil prices, rupee stability and a moderation in foreign investor outflows.

IT Stocks Lead Losses

Information technology stocks emerged as the biggest drag on the market, with the Nifty IT index falling more than 1%.

Infosys declined 2.3% to emerge as the top loser on the Nifty. HCL Technologies, TCS and Tech Mahindra also traded lower, extending the sector's underperformance after concerns over global technology spending resurfaced following Accenture's cautious outlook last week.

Among the top gainers were Dr Reddy's Laboratories, Adani Enterprises, Trent and Adani Ports, which helped limit losses in the broader market.

Nine of the 16 major sectoral indices traded higher, while broader markets remained resilient. The Nifty Midcap and Smallcap indices gained 0.1% and 0.2%, respectively.

Lower Crude Remains A Key Support

Crude oil prices continued to soften as the US and Iran carried on peace negotiations in Switzerland.

Brent crude futures traded near $77.21 per barrel, down 0.4%, while WTI crude slipped 0.3% to $73.63 per barrel. The decline in crude prices has eased concerns over India's inflation outlook, current account deficit and corporate profitability.

Broader Asian markets, however, traded weaker after a strong rally over the previous week, with investors turning cautious ahead of key global events.

Monsoon In Focus

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said improving prospects for peace in West Asia and the sharp correction in Brent crude below $80 have strengthened expectations for GDP growth and corporate earnings in FY27.

He noted that stability in the rupee and the continuing moderation in foreign portfolio investor selling remain supportive factors for Indian equities.

However, Vijayakumar flagged the slow progress of the southwest monsoon as a key concern. The rainfall deficit currently stands at 42.2%, and a prolonged shortfall could impact rural demand, inflation and sectors such as FMCG.

He added that global investors would closely monitor commentary from the US Federal Reserve following the July 28-29 FOMC meeting, particularly amid persistent inflation and elevated US bond yields. Rising bond yields, he said, remain a headwind for equity markets globally.