Fresh worries around artificial intelligence-driven spending pulled markets lower in the US and then across Asia, as investors reassessed how quickly big-ticket tech projects can actually get financed. The nervousness could spill into Indian equities as well, especially because the selling pressure has been concentrated in large tech names.
One trigger this time is a report suggesting Oracle’s large data centre build-out is facing funding hurdles. Adding to the mood, another report indicated some OpenAI-linked data centre construction timelines may have been pushed to 2028. In that backdrop, several heavyweight tech stocks such as Oracle, Broadcom, AMD, Nvidia and Alphabet saw sharp cuts, with some names dropping as much as 5% in a session. Over the last month, Oracle is said to have fallen around 11% and Broadcom around 19%, highlighting how quickly sentiment can turn when the market starts questioning capex assumptions.
Investors are also watching a key political cue. US President Donald Trump is scheduled to address the nation in a major speech, and markets appear keen to see whether he signals any shift on corporate actions such as share buybacks, dividend payouts and executive compensation. Reports suggesting tighter controls in these areas added to the cautious tone in US trade.
US indices closed lower on Wednesday, extending the recent pullback from record levels. The Dow Jones fell 228.29 points, or 0.47%, to 47,885.97. The S&P 500 slipped 78.83 points, or 1.16%, to 6,721.43, while the Nasdaq Composite dropped 418.14 points, or 1.81%, to 22,693.32. Early Thursday futures were mixed, with the Dow marginally lower and the S&P 500 and Nasdaq slightly higher.
European markets also ended lower, although the UK’s FTSE rose after inflation eased to 3.2%. There is speculation the Bank of England could cut rates by 0.25% to 3.75%, while the European Central Bank is expected to hold rates steady at its policy review. Some market participants also expect the ECB’s growth forecast to be revised up from 1.2%.
Asian markets traded weaker again, reflecting the renewed AI-related nervousness from the US session. Japan’s Nikkei and South Korea’s Kospi were down around 1.5% at one point, while China and Hong Kong also opened lower. Rate expectations are in play too, with markets pricing in the possibility of the Bank of Japan raising its policy rate to 0.75%.
Back home, Indian equities fell for a third straight session on Wednesday. Even after a strong rupee recovery — driven by heavy intervention that reportedly helped the currency strengthen by about 0.70% — market confidence remained subdued. Foreign investors were net buyers on the day, but that did not change the broader worry that risk appetite is still fragile, especially with uncertainty continuing around the India-US trade deal.
Sector-wise, most pockets were weak, with declines seen in financial services, FMCG, media, realty, private banks, healthcare, consumer durables, defence, tourism and capital markets.
Public sector banks, IT, oil, metals and pharma were among the relative exceptions. Stock-specific moves were also sharp in places, including a drop in Indian Overseas Bank after the floor price for an offer-for-sale was set below its QIP price, and a fall in Akzo Nobel after a promoter-level share sale. Meesho’s stock jumped, while Ola Electric slid after its founder sold shares to raise funds for debt repayment, according to market chatter.
Foreign institutional investors recorded net cash market buying of ₹1,171.71 crore on Wednesday, while domestic funds were also net buyers at ₹768.94 crore. The Sensex ended down 120.21 points, or 0.14%, at 84,559.65. The Nifty slipped 41.55 points, or 0.16%, to 25,818.55. Bank Nifty fell 107.85 points, or 0.18%, to 58,926.75. Broader markets were weaker, with the Nifty Midcap 100 down 0.54% and the Nifty Smallcap 100 down 0.73%.
Signals from GIFT City point to a soft start. Nifty derivatives closed at 25,872.50 on Wednesday night and moved around the 25,855–25,881 band early Thursday, indicating the index could open lower unless sentiment improves quickly. Technically, the market is watching whether the 25,700–25,750 support zone holds. If that area gives way, traders may start talking about a deeper slide towards 25,500. On the upside, resistance is seen around 25,900 and 25,980.
Commodities moved the other way. Crude oil climbed back above $60 a barrel after earlier weakness linked to Ukraine peace hopes. Prices firmed again after restrictions were announced on Venezuelan oil tankers, pushing Brent up by around 1.5% to close near $60.74. Early Thursday, Brent hovered around $60.55, WTI near $56.85, and Murban crude around $60.86. Natural gas also rose to around $4.113.
Gold and silver advanced as well, with some choppy moves suggesting frequent profit-taking. Gold jumped $36 to close around $4,339.30 an ounce after swinging between $4,301 and $4,350, and it remained volatile in early trade. In Kerala, 22-carat gold rose by ₹480 per sovereign to ₹98,640 on Wednesday. Silver surged close to 4% to touch $66.92 an ounce before easing back, while in India silver prices crossed ₹2.06 lakh per kg.
Industrial metals strengthened too, with copper rising 0.72% to close around $11,719.85 a tonne and aluminium up 0.64% to $2,895.62. The dollar index climbed to 98.37, while US bond yields eased further, with the 10-year yield down to around 4.143%.
The rupee staged a strong comeback on Wednesday after opening weak. The dollar rose to ₹91.08 before slipping sharply to ₹89.99 amid reported central bank action, prompting exporter selling and a mild rebound later. The dollar finally closed at ₹90.38 compared with ₹91.03 in the previous session.
Crypto assets, however, moved lower. Bitcoin slipped below $86,000 in early trade, while Ether fell under $2,825 and Solana under $124. Smaller tokens reportedly dropped 5% to 8%, indicating risk appetite remains patchy across asset classes.
