Benchmark stock market indices opened lower on Tuesday as concerns over the prolonged Middle East conflict, rising inflation risks and relentless foreign investor selling continued to weigh on sentiment.
The S&P BSE Sensex fell 302.16 points, or 0.41%, to 73,965.18 in early trade, while the NSE Nifty50 declined 107.05 points, or 0.46%, to 23,275.55 as of 9:25 am.
Investor sentiment remained fragile amid stalled peace talks between the US and Iran, with Brent crude hovering near $94 per barrel. The prolonged conflict has pushed energy prices higher and raised concerns over inflation and economic growth. Adding to the pressure, foreign institutional investors (FIIs) sold shares worth Rs 3,911.68 crore on Monday. Overseas investors have now pulled out $26.4 billion from Indian equities so far in 2026, surpassing the record annual outflow seen in 2025.
The Indian rupee also weakened, opening 0.1% lower at 95.06 against the US dollar, compared with its previous close of 94.99.
Broader markets were under pressure as well, with the Nifty Midcap 100 falling 0.51% and the Nifty Smallcap 100 declining 0.33%. India VIX, however, slipped 2.28%.
Among sectoral indices, Nifty IT was the lone bright spot, rising 2.16% on strong gains in technology stocks. Nifty Metal gained 0.14%, while most other sectors traded in the red. Nifty Financial Services and Nifty Healthcare Index fell 1.06% each, while Nifty Pharma declined 1% and Nifty Private Bank lost 0.66%.
Among Sensex stocks, Infosys led the gainers with a rise of 3.38%. Tata Consultancy Services gained 2.75%, HCL Technologies advanced 1.60%, Tech Mahindra climbed 1.37%, and Mahindra & Mahindra rose 0.73%. Asian Paints and Larsen & Toubro also traded higher.
On the losing side, Bajaj Finance dropped 2.82%, Eternal fell 1.75%, Bajaj Finserv declined 1.48%, NTPC slipped 1.44%, and Larsen & Toubro lost 1.23%. UltraTech Cement, Sun Pharmaceutical Industries and Bharat Electronics were also among the major losers.
Dr VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, “The trend of sustained AI trade, new records for markets in US, South Korea and Taiwan, sustained FPI selling in India and India’s underperformance are continuing with no immediate signs of reversal.”
He added, “To add to India’s problems, the energy shock has led to downward revision of India’s GDP growth and upward revision of inflation this financial year. And now we have the additional threat of the IMD’s latest projection of monsoon rains at 90% of long-term average, which will have negative implications for growth and inflation.”
Commenting on the outlook, Vijayakumar said, “A resolution of the West Asia conflict and the consequent dip in crude price will be a big positive; but expectations on that front have been belied and the issue continues to hang fire. In these tough times of huge uncertainty and challenges, the ideal strategy for investors is stick to the basics. Do proper asset allocation based on one’s risk profile and financial goals and wait with patience.”