The SENSEX fell as much as 264 points on Monday, extending a four-week losing streak as Sensex dropped over 250 points to 76,098.18 and Nifty 50 lost 131.10 points to 23,769.50 at 11:30 AM. The NIFTY50 closed below the crucial psychological support level of 23,850, indicating renewed bearishness in the index. According to latest market data, the NIFTY50 index closed 0.17% or 41 points higher at 23,873.45, compared to 23,914.45 points at the previous equity market close. The BSE SENSEX closed 0.55% or 417 points lower at 76,152.86 points, down from 76,570.35 points at the previous stock market close. In the four consecutive trading sessions, the Sensex and Nifty declined 1.44% and 1.25% respectively, as per Business Standard reports. However, the market opened lower with Sensex opening at 76,446.05 and trading at 76,400.06, down 115.37 points or 0.15% as of 9:23 AM, while Nifty 50 opened at 23,883.15 and slipped further to 23,857.65, down 40.05 points or 0.17%. The Bank Nifty index opened at 57,497.85, up by 325.85 points, or 0.57%. The market breadth was negative with 1,931 shares rising and 2,232 shares falling on the BSE, while 263 shares remained unchanged.
The NIFTY IT index declined 2.7% to 29,847.25, hitting the day's low and representing a significant escalation from earlier declines. In the IT basket, stocks registered declines in the range of 2-4%, with Infosys emerging as the biggest loser with a 3.8% fall. LTM, Persistent Systems, Mphasis, Wipro and Coforge shed nearly 3% each, while TCS, Tech Mahindra, HCL Tech and OFSS were down in the range of 2-3%. The selling also extended to midcap technology companies, with LTM declining as much as 2.25% to ₹4,451.10, Mphasis falling 2.18% to ₹2,369.10 and Oracle Financial Services Software slipping 2.04% to ₹11,812. Persistent Systems and Coforge also declined 1.67% and 1.80%, respectively. Among the sectors, Nifty IT dropped more than 1% while Nifty Metal declined around 0.6%, with Nifty Midcap 100 index recording marginal gains while Nifty Smallcap 100 index remained in the red. The IT sector has declined 22% so far this year, 13.67% in one year and 5.21% in one month time frame, as per Business Standard reports.
The decline in IT stocks came as expectations of higher US interest rates strengthened following stronger-than-expected US employment data. US job growth accelerated sharply in August while the unemployment rate remained steady at 4.1%, implying an improvement in the labour market after recent struggles, with US nonfarm payrolls increasing by 162,000 in August, well above economists' expectations of a gain of 56,000. Markets were pricing in a 58% probability of a rate hike at the September 16 meeting and a 70% chance of a move in October. The probability of a hike now stands at 58%, up from 47% last month, according to the CME FedWatch tool. The next Federal Reserve meeting is set to take place on September 15-16, which will also mark the first FOMC meeting for the new Fed Chair, Kevin Warsh, who last month noted that curbing inflation remains Fed's top priority. Earlier last week, In the Jackson Hole speech Fed Chair Kevin Warsh's remarked that inflation remains uncomfortably high, which markets read as hawkish. Higher US rates could curb client spending, weighing on Indian IT firms that generate a significant share of their revenue from the United States.
NIFTY IT breached the six-week-long congestion range of 30,165–31,950 to the downside, setting up downside targets around the 29,000–28,800 spot levels, according to Vipin Kumar, AVP research at Globe Capital Market. These levels also coincide with the 50 per cent Fibonacci retracement support of the previous up-move from 25,700 to 31,955. The index failed to defend the swing low trendline support from the April lows and closed below crucial psychological support levels of 24,000 for the second consecutive session on Thursday. Technically, the Nifty remains below its 20-, 50-, and 100-week simple moving averages, with immediate support placed at 23,800–23,850 and resistance at 24,050–24,100. Nifty's downside marker placed at 23,860 remained intact, while also resisting upsides to 23,960 on anticipated lines, said Anand James, Chief Market Strategist at Geojit Investments. Nifty's inability to float above 23,800 could raise fears of a drop to the low 23,000s, with an initial objective of 23,570, the analyst further advised.
Brent crude continues to trade at elevated levels near $96.80 per barrel, with fighting near the Strait of Hormuz disrupting shipping traffic and adding to market uncertainty. The US 10-year Treasury yield climbed to 4.79 per cent, while US equity markets are shut Monday for Labour Day. The November Brent oil contract rose 1.54% or 1.47 to trade at $97.10 a barrel. The hostilities continue between the US and Iran, increasing the fears of supply disruption from the Strait of Hormuz. USD/INR was down 0.49% to 94.51, while EUR/INR fell 0.41% to 109.61. The Indian rupee appreciated 0.7% to open at two-months high after robust FCNR(B) inflows, with rupee opening 67 paise higher at 94.30 per US dollar as against Wednesday's close of 94.97. The Reserve Bank of India (RBI) on Wednesday said forex inflows under its special USD-INR forex swap facility stood at $136.38 billion as of 31 August 2026, according to provisional data reported by authorised dealer banks.
