Sensex, Nifty Drop For 4th Straight Session, IT Selloff & FII Outflows Weigh On Market

Key Highlights:

- Sensex dropped 247 points and Nifty 67 points, marking a 4-day decline due to IT stock selloff and FII outflows.

- Despite benchmark weakness, midcap and smallcap indices rose between 0.71 percent and 1.04 percent.

- Wholesale inflation slipped to -0.13 percent in June, driven by deflation in food, fuel, and manufactured goods.

Mumbai: The benchmark equity indices Sensex and Nifty extended their losing streak to the fourth consecutive session on Monday, driven by persistent selling in IT stocks and continued foreign fund outflows. The 30-share BSE Sensex closed 247.01 points or 0.30 percent lower at 82,253.46. During intraday trade, it had dropped as much as 490 points to 82,010.38 but managed to recover some losses by the close.

Similarly, the broader 50-share NSE Nifty settled at 25,082.30, down 67.55 points or 0.27 percent. Since July 9, the Sensex has dropped nearly 1,460 points (1.75 percent) and the Nifty has lost around 440 points (1.73 percent).

IT stocks drag, FIIs continue to exit

Among the worst-performing Sensex stocks were Asian Paints (down 1.58 percent), Tech Mahindra, Bajaj Finance, Infosys, HCL Tech, TCS, L&T, and Tata Motors. However, a few stocks such as Eternal, Titan, Mahindra & Mahindra, and ITC ended in the green.

Foreign Institutional Investors (FIIs) remained net sellers, pulling out Rs 5,104.22 crore on Friday, adding pressure to market sentiment. Despite this, broader markets performed better with midcap and smallcap indices gaining between 0.71 percent and 1.04 percent.

Investor caution amid global and domestic cues

Vinod Nair, Head of Research at Geojit Financial Services, noted that consolidation in the market was due to weak earnings and tariff-related news. Valuations remain high, prompting cautious investor sentiment. He added that while IT continues to underperform due to fears of earnings downgrades, other sectors like healthcare, realty, and consumer discretionary are seeing selective buying.

Global trends and economic indicators

Globally, Asian markets showed mixed trends. South Korea’s Kospi, China’s Shanghai Composite, and Hong Kong’s Hang Seng ended in the green, whereas Japan’s Nikkei closed lower. European stocks traded in the red, while US markets ended lower on Friday.

On the economic front, India’s wholesale price index (WPI) inflation turned negative for the first time in 19 months, declining to -0.13 percent in June, driven by falling food and fuel prices. Meanwhile, Brent crude prices rose 0.99 percent to USD 71.06 per barrel.

(With PTI Inputs)