Indian equity benchmarks extended their losing streak for a second session on Tuesday, as heavyweight stocks like HDFC Bank Ltd and Reliance Industries Ltd (RIL) exerted significant downward pressure on the frontline indices. The 30-share BSE Sensex declined by 238.41 points, or 0.31%, to settle at 77,470.11, while the NSE Nifty50 index fell 50.80 points, or 0.21%, closing at 24,187.70.
Despite the weakness observed in the benchmark indices, the broader market showed remarkable resilience. The Nifty Midcap100 index posted a gain of 0.30%, and the Nifty Smallcap100 advanced by 0.53%, indicating a stronger performance among mid and small-sized companies.
Key Contributors to the Decline
Several major stocks contributed significantly to the Sensex's decline. These included HDFC Bank, Reliance Industries (RIL), State Bank of India (SBI), Infosys Ltd, Tata Consultancy Services (TCS), ITC Ltd, Trent Ltd, Power Grid Corporation of India Ltd, and Eternal.
Sectoral performance was mixed. Realty, auto, and metal stocks managed to buck the weak trend, posting gains. Conversely, PSU banks, IT, and oil & gas counters emerged as the top losers, reflecting varied investor sentiment across different segments of the economy.
Analyst Insights on Market Trends
Vinod Nair, Head of Research at Geojit Investments, commented on the midcap segment's performance, stating, "Despite geopolitical challenges, midcaps are performing well in anticipation of strong corporate earnings, supported by demand-led business updates." He cautioned, however, that while underlying business conditions are expected to remain healthy through the first half of FY27, sustaining this momentum would require the normalization of rising input costs, as demand growth might flatten in the latter half of the fiscal year. Nair also noted that the broader market is currently in a mixed range, with large caps underperforming due to moderating inflows amidst rising geopolitical risks and higher crude oil prices.
Ankur Punj, MD & Business Head at Equirus Wealth, further highlighted the impact of global factors, stating that a "spike in global crude oil prices amid growing uncertainty over the lingering West Asia conflict prompted investors to further trim their equity exposure."
Nifty Outlook and Support Levels
Rupak De, Senior Technical Analyst at LKP Securities, offered an outlook on the Nifty50. He described Tuesday's trading session as "lacklustre," with the index failing to establish a clear directional bias. Despite this, the Nifty managed to hold above its key moving averages, signaling an underlying positive trend. "On the lower timeframe, it found support at a crucial moving average and rebounded, indicating buying interest at lower levels," De added.
For the near term, De anticipates the overall trend for the Nifty to remain positive, with potential to move towards the 24,400 mark. On the downside, immediate support is identified at 24,150. A decisive breach below this level, he warned, could trigger further weakness, potentially dragging the index towards 23,950.