Stock markets saw a sharp reversal on Thursday, with both Sensex and Nifty giving up early gains and slipping into the red as investors booked profits after the recent rally.
Dalal Street had opened higher, extending gains for the second straight session on hopes that talks between the United States and Iran could resume. However, the early optimism did not last, and markets turned volatile as the day progressed.
Markets saw strong swings during the session, highlighting the uncertain mood among investors.
The BSE moved within a wide range of 1,055.39 points, touching a high of 78,730.32 and a low of 77,674.93. The NSE Nifty 50 also saw similar movement, trading in a range of 298.15 points between a high of 24,400.95 and a low of 24,102.80.
This shows that markets rose in early trade but later saw selling pressure, leading to a sharp fall before a partial recovery.
The main reason behind the fall was profit booking. After the recent rally, many investors chose to lock in gains, leading to selling across sectors.
This kind of movement is common after a sharp rise, especially when markets have already priced in positive news.
Crude oil prices also moved slightly higher, which added to the cautious mood.
Brent crude was trading at $96.50, up 1.65%, while WTI crude stood at $92.65, rising 1.49%. Higher oil prices can be a concern for India, as it increases costs and can impact inflation.
Market breadth remained mixed, with both gainers and losers visible across sectors.
Among the gainers were Trent, Adani Ports, Eternal, BEL and Larsen & Toubro, which rose between around 1% and nearly 3%. Stocks like TCS, Infosys, Asian Paints and UltraTech Cement also saw modest gains.
However, several heavyweights came under pressure. Reliance Industries, HDFC Bank, Bharti Airtel, Kotak Bank and ICICI Bank were among the key losers. Stocks like M&M, Titan, Hindustan Unilever and Power Grid also declined.
This mixed trend shows that while some stocks held gains, selling in large-cap names pulled the indices lower.
Sector-wise, the trend was also mixed.
Nifty Metal rose 1.30% and Nifty IT gained 0.58%, showing some strength. Nifty Realty and Consumer Durables also saw small gains.
On the other hand, sectors like Auto, Financial Services, PSU Bank, Pharma and Oil & Gas were trading in the red. This indicates that the weakness was spread across key sectors.
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said markets are looking beyond the ongoing conflict.
“It is 47 days since the war began. What is the message from the markets? Brent crude is down to $95 level from the recent peak of $119. S&P 500 set a new record yesterday at 7022. Nasdaq also is at a new record high. The message from the crude market and the US stock market is that the West Asian conflict is unlikely to last long. The stock market is discounting an early end to the conflict,” he said.
He pointed out that the Nifty has recovered strongly after the recent correction.
“In India Nifty has rebounded from the 12% correction after the war. Nifty is up by about 2000 points from the lows touched around 30th of March,” he said.
He also noted that broader markets have performed better than large caps.
“It is important to note that the mid and small caps have outperformed the large caps. In fact the small cap index is slightly above the pre-war level and mid cap index is only marginally lower by around 0.5% while Nifty is down by about 3.8% from the pre-war levels,” he said.
According to him, this is mainly due to selling by foreign investors in large-cap stocks.
“The underperformance of the large caps is due to the big FII selling. The outperformance of the broader market may continue in the near-term,” he added.
He advised investors to focus on strong stocks.
“Investors should watch the stocks which are hitting 52-week highs even in a weak market. Such stocks reflect fundamental strength and accumulation by smart money,” he said.
The sharp swings seen on Thursday highlight the importance of staying cautious in a volatile market.
While the overall trend remains supported by global cues and easing oil prices in recent sessions, short-term movements can be unpredictable due to profit booking and global uncertainties.
(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.)