Indian equity markets snapped a sharp four-day rally on Thursday as investors booked profits at higher levels and fresh geopolitical concerns dented sentiment.
The BSE Sensex declined 931.25 points, or 1.20 percent, to close at 76,631.65, while the NSE Nifty 50 fell 222.25 points, or 0.93 percent, to settle at 23,775.10.
Markets had surged more than 1,800 points, or 8.30 percent, over the previous four sessions, prompting investors to lock in gains. The Nifty formed a bearish candle on the daily chart with shadows on both sides, indicating indecision near higher levels.
Despite the decline, the index continues to trade above its 20-day EMA, offering near-term support. The downward slope in longer-term moving averages — 50-day, 100-day and 200-day — has eased, suggesting moderation in medium-term downside momentum. The RSI remains around the 51 mark, signalling a neutral to mildly positive trend.
The IT sector offered limited support to the market. Shares of TCS gained 1.2 percent ahead of its earnings announcement, helping the IT index edge up 0.2 percent.
However, gains in the sector remained capped amid concerns over rising disruption risks from artificial intelligence, following new developments by US-based firm Anthropic.
Ceasefire-led optimism faded as renewed tensions between the US and Iran and continued restrictions at the Strait of Hormuz pushed crude prices higher again. This revived concerns over inflation for India, a major oil importer.
Additional pressure came from rising 10-year bond yields and weakness in the rupee, which together reduced near-term risk appetite. Globally, a hawkish tilt in the latest US Federal Reserve minutes also weighed on emerging market sentiment, raising the possibility of further rate hikes.
Financial stocks led the decline after the previous session’s sharp rally, amid continued foreign institutional investor selling.
Among Sensex constituents, IndiGo, Larsen & Toubro, Eternal, HDFC Bank and ICICI Bank were the major losers.
Broader markets showed resilience despite the benchmark weakness:
Nifty Midcap 100 gained 0.32 percent
Nifty Smallcap 100 rose 0.17 percent
Nifty Metal index rose over 1.2 percent
Healthcare and pharma stocks also saw gains
Financials remained under pressure
If crude prices remain elevated, concerns over inflation and earnings downgrades for FY27 could resurface. However, valuations have turned more reasonable after the recent correction, and any easing in geopolitical tensions could quickly revive investor confidence in the medium term.
Sensex: 76,631.65 (down 931.25 points)
Nifty 50: 23,775.10 (down 222.25 points)
Nifty Midcap 100: up 0.32 percent
Nifty Smallcap 100: up 0.17 percent
Nifty Metal: up 1.2 percent