Indian stock markets experienced severe losses on Tuesday, with the Sensex declining 722 points or 0.94% to an intraday low of 76,371.70 and the Nifty 50 slipping 241 points or 1% to touch a day's low of 23,862.65 as global tech meltdown spread across markets. According to Business Standard, as of 2:20 PM, the 30-share Sensex traded with a cut of 615 points or 0.80% at 76,479, while the Nifty 50 was at 23,896, down 204 points or 0.85%. Only four counters from the Sensex pack traded in the green -- Power Grid, Sun Pharma, Axis Bank and Maruti, while Tata Steel, TCS, Infosys, Adani Ports and BEL were down more than 2% each. Today marks the weekly expiry of Nifty 50 contracts, which often sees heightened volatility and increased liquidity as traders unwind positions. India VIX, the fear gauge index, spiked 7.7% to 13.85, indicating heightened volatility. Today's fall wiped more than ₹3.5 trillion in investor wealth as the market capitalisation of BSE-listed companies stood at ₹476 trillion, down from the previous session's all India market capitalisation of ₹479.71 trillion.
The IT sector emerged as the major sectoral loser, with the Nifty IT falling more than 2% and heavyweights like TCS, Infosys and Wipro down 3% each. As reported by Business Standard, in the past four trading days, Nifty IT index has slipped 6% as Accenture narrowed its annual revenue growth forecast and issued weaker-than-expected fourth-quarter guidance. The IT sector's weakness continues from previous sessions, with the Nifty IT index having tanked 3.57% after Accenture now expects FY26 revenue growth of 3% to 4% in local currency, compared with its earlier forecast of 3% to 5%. In three weeks, the IT index has tanked 13%, highlighting sustained pressure on the sector. Foreign institutional investors (FIIs) sold equities worth ₹1,025.20 crore on Thursday after three sessions of net buying, adding to market pressure.
The Nifty Metal index lost more than 3.5% in intraday trading, emerging as the top sector loser. As reported by Business Standard, Jatin Gedia, VP-Technical Research at Teji Mandi said that the Metal index is undergoing a consolidation phase which is along expected lines after a stellar outperformance. The Nifty Smallcap 100 traded in the red, down 0.50%, while the Nifty Midcap 100 was down 0.95%, indicating broad-based selling pressure across market segments. Among the sectoral indices, only Nifty Pharma traded in the green, up 1.07%, bucking the broader weakness and remaining the only bright spot in the current market environment.
The global tech meltdown seen on Tuesday has resulted in US futures taking a nosedive before trading begins later this evening. As reported by CNBC TV18, Nasdaq futures are down 850 points as of 2:40 PM Indian time, while the technology sub-index of the European Stoxx 600 index fell over 3%. The rout was led by the KOSPI in South Korea, which fell 10% on Tuesday, triggering a circuit halt to trade as well. This fall came after a local media report stated that SK Hynix, one of the two major heavyweights behind the recent rally on the stock, is slowing the expansion of its AI memory chip production and shifting focus to the cheaper commodity DRAM. As a result, shares of both SK Hynix and Samsung Electronics plunged 12.5% each, triggering warning signs for US tech stocks as investors rushed to book profits. Despite this fall, shares of SK Hynix are up 277% for the year so far, while those of Samsung are up over 140%. Notably, the sentiment across Asian markets weakened after a decline in the US technology stocks and caution ahead of Micron Technology's earnings, which investors are closely tracking for cues on AI-driven chip demand. On Monday, Nasdaq Composite fell 351.33 points or 1.32% to 26,166.60 amid a sell-off in technology stocks.
Globally markets will be keenly watching the Fed commentary after the FOMC meeting on July 28-29, which is significant in the context of high inflation in the US and the 10-year yield remaining firm at around 4.5%. As reported by Business Standard, rising yields are negative for equity markets. VK Vijayakumar, chief investment strategist, Geojit Investments, said that the concern now is the poor monsoon, so far this season. The deficit now is huge at 42.2%, with concerns that if the feared super El Niño leads to sharp shortfall in monsoon, it can be negative for growth and inflation. Poor monsoon can impact rural demand and sectors like FMCG, making the progress of the monsoon crucial to watch. Weak global cues also contributed to the sell-off, with Asian markets coming under heavy selling pressure as Japan's Nikkei 225 index fell 3.55%.
For the Nifty, the 23,800 - 23,900 zone has been one of support and the bulls would be aiming to defend that on a closing basis. As reported by Business Standard, Axis Securities noted that Nifty 50 formed a Doji candlestick on Monday, reflecting indecision among traders near the upper band of the falling channel that has been in place since April 21. For the bulls to regain control, the index needs a decisive close above last week's high of 24,200. A breakout above this level could open the doors for a move towards 24,300 and 24,454, where the 200-day EMA is placed. On the downside, 24,000 will act as the first line of defence, followed by Friday's low near 23,900. From a positional perspective, the bullish gap between 23,818 and 23,645 remains intact and should act as a crucial support zone.
