Benchmark indices ended almost flat on Tuesday, as rising crude oil prices and renewed concerns over inflation and interest rates offset the support from strong domestic growth. The Sensex fell 12.99 points, or 0.02%, to 76,944.28, while the Nifty 50 declined 24.60 points, or 0.10%, to 24,055.80.
The market remained under pressure for much of the session as escalating tensions in the Middle East pushed crude prices higher. Brent crude was trading at $91.21 a barrel, up 0.8%, while WTI crude rose 1.08% to $86.69.
The latest move in oil prices is a concern for India because sustained elevated crude can put pressure on inflation, the rupee, corporate margins and the country’s external balance. This came even as India’s latest GDP data showed the economy grew 7.8% in the first quarter.
Vinod Nair, Head of Research, Geojit Investments Limited, said markets were increasingly balancing India’s strong growth momentum against mounting global uncertainties.
“Better-than-expected GDP growth underscores the resilience of domestic demand and the broader economy,” Nair said. However, he cautioned that escalating geopolitical tensions in the Middle East and a more hawkish Federal Reserve had renewed concerns about inflation and the possibility of interest rates remaining elevated for longer.
“Persistent cost pressures may weigh on both corporate earnings and the pace of demand recovery,” Nair said, adding that higher US bond yields and renewed foreign capital outflows had kept investor sentiment cautious.
Nair said financial stocks faced the most pressure, while FMCG and IT sectors continued to attract defensive buying. “In the near term, market trends are likely to be driven by developments in energy markets, global monetary policy expectations, and capital flows into emerging economies,” he said.
Banking stocks came under pressure, with the Nifty Financial Services 25/50 falling 1.15%, Nifty Private Bank declining 0.87% and Nifty PSU Bank losing 1.21%. Nifty Financial Services ex-Bank also fell 1.90%.
Among stocks, Maruti was the biggest loser, declining 4.16%, followed by Bajaj Finserv, which fell 2.40%, and M&M, which declined 2.36%. SBI lost 1.31%, Axis Bank fell 1.80%, Bajaj Finance declined 1.09% and Sun Pharma slipped 1.31%.
Bharti Airtel fell 1.42%, Trent declined 1.03%, UltraTech Cement lost 0.88% and ICICI Bank fell 0.91%.
On the other hand, ITC was the top Sensex gainer, rising 3.98%. HCLTech advanced 3.21%, Infosys gained 2.44% and Bharti Airtel’s earlier gains moderated before the close. Reliance Industries rose 1.74% and Kotak Mahindra Bank added 1.54%.
The sectoral picture was mixed. Nifty IT rose 0.98%, while Nifty FMCG gained 0.94% and Nifty Media added 0.26%. Nifty Oil & Gas also edged higher by 0.35%.
Nifty Chemicals gained 0.13%, while Nifty Metal was almost flat.
On the losing side, Nifty Healthcare Index declined 1.60%, Nifty Pharma fell 1.45% and Nifty Realty dropped 1.42%. Nifty Auto declined 1.22%, Nifty Financial Services 25/50 fell 1.15% and Nifty Consumer Durables lost 1.40%.
Nifty MidSmall Healthcare fell 0.73%, Nifty MidSmall Financial Services declined 1.98%, while Nifty MidSmall IT & Telecom lost 0.38%.
The divergence was also visible across financial segments, with Nifty Financial Services ex-Bank falling 1.90%, while Nifty Private Bank declined 0.87%.
The broader market came under greater pressure than the headline indices. Nifty 100 fell 0.31%, Nifty 200 declined 0.53% and Nifty 500 lost 0.47%.
Nifty Midcap 50 fell 1.31%, while Nifty Midcap 100 declined 1.39%. Nifty Smallcap 100 also fell 0.23%.
India VIX, however, rose 0.49%, indicating some increase in market volatility.
Among the other broader sectoral indices, Nifty MidSmall Healthcare fell 0.73%, Nifty MidSmall Financial Services declined 1.98%, Nifty MidSmall IT & Telecom fell 0.38%, while Nifty500 Healthcare declined 1.10%.
Despite the pressure, Nifty Financial Services ex-Bank and Nifty MidSmall Financial Services showed the contrasting performance within financial segments, with the former falling 1.90% and the latter declining 1.98%.
The day’s trading reflected the broader tension in Indian markets: strong domestic growth and pockets of buying in IT and FMCG provided support, but expensive crude and global rate concerns continued to cap the upside.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)