The Indian benchmark indices tumbled on Friday as the Sensex fell over 1000 points to settle at 82,600 and the Nifty fell over 300 points to close trade at 25,471 at 3:30 PM.
In the 30-share BSE Sensex, among the top gainers were Bajaj Finance and the State Bank of India. Meanwhile, TechMahindra, Ultra Cement, L&T, Axis Bank and Maruti were the laggards.
In the broader markets, the Nifty Smallcap 50 tumbled 1.88 per cent as volatility remained high. Sectorally, Nifty Midsmall IT & Telecom fell 1.96 per cent.
Previously, during the morning session, the Sensex breached 83k, crashing close to 700 points, and the Nifty nosedived more than 200 points and tested 25,600, around 9:15 AM.
Technology stocks bore the brunt of selling pressure for a second straight session, dragging frontline indices lower. Heavyweights such as Infosys, Tata Consultancy Services, HCL Technologies and Tech Mahindra emerged as major laggards on the Sensex.
Other stocks trading in the red included Eternal, Hindustan Unilever, Adani Ports, Trent, Tata Steel, Reliance Industries, IndiGo, Larsen & Toubro, UltraTech Cement and NTPC. In contrast, Bajaj Finance, HDFC Bank and Bharti Airtel were the only gainers.
Broader markets mirrored the weakness. The BSE SmallCap Select Index declined 1.93 per cent, while the MidCap Select Index fell 1.40 per cent.
‘Turbulent Phase’ For Markets
VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said, “Markets have fallen into a turbulent phase which will cause some panic among investors even while offering opportunities. The sell off in AI stocks in US markets was expected but the timing and extent of the sell-off was not known.”
He added, “For the Indian market, this correction in AI stocks is a positive, because last year’s global rally was primarily an AI trade in which India, an AI laggard, couldn’t participate. So the unwinding of the AI trade, if it persists, is a positive from the Indian perspective.”
However, he cautioned that the immediate concern remains the sharp correction in IT counters. “What is rattling the Indian market now is the massive sell-off in IT stocks, which is the second largest profit pool of India Inc. The real impact of the ‘Anthropic shock’ on the IT sector is yet to be ascertained,” he said.
Global Cues Remain Weak
Asian markets were largely lower, with Hong Kong’s Hang Seng, Japan’s Nikkei 225 and Shanghai’s SSE Composite trading in negative territory. South Korea’s Kospi, however, was quoting higher.
US equities ended lower overnight. Devarsh Vakil, Head of Prime Research at HDFC Securities, said, “Wall Street indexes fell sharply on Thursday, with the technology-heavy Nasdaq slumping 2 per cent, as investors intensified their selloff of tech shares and fled transport stocks amid worries about artificial intelligence disruption.”
He added that major technology stocks declined sharply as concerns mounted over AI’s potential to disrupt existing business models.
Institutional Flows And Commodities
According to exchange data, foreign institutional investors bought equities worth Rs 108.42 crore on Thursday, while domestic institutional investors were also net buyers of stocks worth Rs 276.85 crore.
Meanwhile, Brent crude, the global oil benchmark, slipped 0.16 per cent to USD 67.41 per barrel.
