Indian equity benchmarks came under renewed selling pressure on Monday, with the Sensex falling as much as 411 points from the day's highest level and the Nifty 50 index touching an intraday low of 22,953 after hitting a high of 23,077. According to Upstox Securities, the indices reversed early gains as elevated US bond yields, persistent foreign investor outflows and geopolitical concerns weighed on investor sentiment throughout the trading session. The selling pressure was primarily driven by weakness in IT, FMCG, and financial stocks, which weighed heavily on market sentiment and contributed to the significant intraday losses in both major indices. On Wednesday, the Nifty 50 declined 99 points, or 0.44%, to close at 22,623, testing the support zone of 22,580-22,620, which might weaken with repeated tests.
IT stocks emerged as the top performers during the volatile trading session, while FMCG stocks led sectoral losses with the Nifty FMCG index falling nearly 2%, as per Upstox Securities. In contrast, the Nifty PSU Bank index also declined more than 1%, and the Nifty Auto index advanced nearly 1%, emerging as one of the better-performing sectors. This sectoral divergence highlights the mixed performance across different industry segments, with technology stocks benefiting from positive sentiment while consumer goods and banking stocks faced significant selling pressure. The reversal from early gains in both indices highlights the volatile nature of current market conditions and the influence of global factors on domestic equity performance.
The Nifty FMCG Index trades at 31.1 times earnings, representing a 25% discount to its post-2021 five-year average of 41.5, though it remains more expensive than the broader Nifty at 19.3 times earnings. According to Essential Business Intelligence, the sector faces multiple headwinds including weak consumption, rising input costs and earnings downgrades. ITC, which accounts for 27.65% of the Nifty FMCG Index, is expected to see a 20% decline in net sales and 24% drop in earnings before interest, tax, depreciation and amortisation due to higher cigarette excise duty and 40% GST rates. Market experts emphasize that investors need evidence of sustained demand improvement before treating the correction as a buying opportunity.
From a technical perspective, the Nifty continues to test the 22,580-22,620 support zone, which has attracted buying interest but repeated tests could weaken this support unless the index moves back above the 22,750-22,800 range. As reported by The Economic Times, a decisive break below 22,580 could drag the index towards 22,400 and 22,300, while a sustained move above 22,800 could open the way towards 23,000. The Nifty's failure to sustain levels above 22,600 turned the positive opening into another sell-on-rise session, with market breadth remaining slightly tilted towards the bears as 1,798 stocks ended in the red out of 3,706 traded on the NSE.
Several companies including Reliance Industries, Tata Technologies, HDB Financial Services, Bajaj Consumer Care, IDBI Bank, Punjab National Bank and others are expected to remain in focus on Thursday as investors track quarterly earnings and corporate announcements. Reliance Industries is expected to be in focus due to upcoming quarterly earnings, while Tata Technologies reported 22% year-on-year growth in US dollar revenue and remains confident of delivering strong double-digit growth for the full year. HDB Financial Services saw net interest income rise 15.5% to ₹2,534 crore and declared an interim dividend of ₹2 per equity share. Bajaj Consumer Care reported 25.7% revenue growth to ₹333 crore with EBITDA margin expanding to 24.7% from 18.1% year earlier.
