Key Highlights

  • Weak start: Sensex opened at 72,990.04, down 133.79 points (0.18%), while Nifty fell 75.60 points (0.33%) to 22,524.40.
  • IT drags the most: Nifty IT was the worst-performing sectoral index, falling over 2 per cent.
  • Pockets of strength: Nifty Private Bank rose 0.49 per cent, while pharma and healthcare indices held firm.
  • Institutional support: FIIs bought equities worth Rs 887 crore on October 23, while DIIs extended their buying streak to four sessions with Rs 3,236 crore.
  • Crude remains elevated: Brent fell over 2 per cent to around $114 per barrel, and WTI dropped to $100.70, but analysts say prices are still high enough to cap any rally.

Indian equity markets began the week on a cautious note on Monday, with heavy selling in information technology shares pulling the benchmark indices lower at the opening bell. The BSE Sensex opened at 72,990.04, down 133.79 points or 0.18 per cent, while the NSE Nifty slipped 75.60 points or 0.33 per cent to 22,524.40.

The pressure was concentrated in tech counters, with the Nifty IT index emerging as the worst performer of the session after falling more than 2 per cent. The weakness spread to other sectors as well, with Nifty MidSmall IT & Telecom, Realty, Oil & Gas, PSU Bank, Consumer Durables, Cement and Auto indices declining by up to 1 per cent. Private lenders bucked the trend, with Nifty Private Bank gaining 0.49 per cent, while pharmaceutical and healthcare stocks showed resilience.

Crude Oil: The Shadow Over Every Rally

While the IT sell-off grabbed the opening headlines, the more structural concern for Dalal Street remains crude oil. Brent crude declined over 2 per cent to around $114 per barrel, and US benchmark WTI fell over 2 per cent to $100.70, as oil retreated from six-month highs. Yet analysts cautioned that even after this dip, prices remain elevated and could limit the scope for a sustained recovery from recent lows.

This matters more for India than for most markets. As a country that imports the bulk of its crude requirements, higher oil prices tend to widen the import bill, add to inflationary pressure and squeeze margins for oil-dependent industries such as aviation, paints and logistics. That explains why analysts are urging investors to stay mindful of macroeconomic risks even as they look for value-buying opportunities created by the recent correction.

A Silver Lining in Global Flows

There is, however, a notable positive in the broader picture. According to experts, the cooling of the global artificial intelligence trade is working in India’s favour, with foreign portfolio investor (FPI) outflows from South Korea and Taiwan exceeding those from India in recent months. Since those markets are heavily weighted towards AI-linked chipmakers, India’s relatively lower exposure is helping it hold up better as global money rotates.

Institutional data reinforces this resilience. In the previous trading session on October 23, foreign institutional investors were net buyers of equities worth Rs 887 crore, while domestic institutional investors bought shares worth Rs 3,236 crore, extending their buying streak to four sessions.

Analysts also linked last week’s sharp correction in midcap and smallcap stocks largely to the liquidation of margin-funded trades, suggesting the fall was driven more by leverage unwinding than by a collapse in fundamentals. They believe this could open up opportunities in select high-growth segments.

Across Asia, markets also opened cautiously as investors prepared for a busy week of central bank meetings and corporate earnings that could further test confidence in the AI-driven rally. For Indian investors, the coming sessions are likely to be shaped by a tug-of-war between supportive institutional flows and the persistent drag of high crude prices.