Indian benchmark indices experienced a sharp reversal on Friday, with Nifty 50 falling as much as 0.9% to 23,947.25, while BSE Sensex declined as much as 1% or 770 points to 76,639. This marked the end of a five-day gaining streak that had seen the indices rise for consecutive sessions. The negative opening signal came despite positive global market signals, with GIFT Nifty trading at 24,000 at around 8 AM, down 192 points or 0.8%, indicating a significant deterioration from Thursday's session. According to NDTV Profit, Nifty June futures rose 0.48% to 24,209, trading at a premium of 41 points, suggesting some recovery expectations despite the current weakness.
The IT sector emerged as the biggest drag on the Nifty 50, with Nifty IT falling 5.83% and hitting its lowest level since April 2023. Infosys was the biggest drag, pulling the index down by 69.54 points, falling 7.54% and hitting its lowest level since December 2020, with the stock now down over 45% from its all-time high. TCS dropped 5.96%, HCL Technologies was down 5.25%, and Tech Mahindra declined 6.16%. All Nifty IT constituents were down over 5%, except Wipro and OFSS. Morgan Stanley said Accenture's Q3 read-through suggests a tough macro environment could continue into the second quarter, with delayed decision-making and Middle East tensions adding to uncertainty. Jefferies said Accenture's revised revenue guidance points to further moderation in growth and could lead to consensus estimate cuts for Indian IT companies.
The United States lifted its limitations on Iran, permitting oil tankers to transit the Strait of Hormuz once more after several months of interruption, coinciding with the initiation of a preliminary ceasefire agreement. Iran's Supreme National Security Council said the Persian Gulf Strait Authority has been instructed to issue permits quickly for commercial ships transiting the Strait of Hormuz under the new memorandum, with no fees charged for 60 days. US Vice President JD Vance said Iran would not receive benefits under the peace plan unless it fully complies and changes its behaviour, with no funds coming from the US under any circumstances. US Central Command said US forces have lifted the blockade on all maritime traffic entering and exiting Iranian ports and coastal areas, with American forces not impeding vessel transit. Oil is headed for its second straight weekly losses, with Brent crude falling towards $79 a barrel and down more than 9% for the week, while West Texas Intermediate for August traded near $75. Kuwait said it will begin increasing production, providing additional relief to global energy markets.
Global markets provided mixed cues despite the weak domestic opening signals. Asian markets extended their record run, with South Korea's Kospi rising 2.82% and Japan's Nikkei 225 advancing 0.79%. Australia's ASX 200 fell 0.89%, while markets in China, Hong Kong and Taiwan were closed for a holiday. According to NDTV Profit, Wall Street ended firmly higher overnight, with the Nasdaq Composite jumping 1.91%, the S&P 500 advancing 1.08%, and the Dow Jones Industrial Average gaining 0.14%. Semiconductor stocks outperformed sharply after US President Donald Trump said Apple would work with Intel to design and manufacture chips in the United States, lifting the Philadelphia Semiconductor Index by 6.4%.
Nifty Realty declined 0.84%, followed by Nifty Bank at 0.53%, Nifty Financial Services at 0.52% and Nifty Metal at 0.49%. Nifty Pharma rose 0.36%, while Nifty Media gained 0.32%, Nifty Energy advanced 0.24% and Nifty Defence added 0.17%. Nifty Bank traded 0.58% lower at 57,625.20 after moving between 57,620.15 and 57,804.90 in early trade. HDFC Bank fell 2.15%, leading losses among banking stocks, while IndusInd Bank declined 0.59%, Kotak Mahindra Bank slipped 0.56%, State Bank of India fell 0.52% and Punjab National Bank was down 0.47%. On the technical front, Ponmudi R from Enrich Money noted that the Nifty's immediate hurdle remains the 24,200 level, with a sustained breakout above that zone potentially opening the door for a move towards 24,400. The 24,000 mark remains a crucial support area, with a breach potentially triggering profit booking towards the 23,900-23,800 zone.
