IT Stocks and Reliance Drag Indian Markets Lower at Midday as Investors Await Fed Decision

Mumbai: Indian equity benchmarks pared some early losses by mid-session on Wednesday but remained firmly negative. The Sensex traded down 462.11 points or 0.63 per cent at 73,136.56 at 12:37 pm, after opening at 73,253.44 against its previous close of 73,598.67. The Nifty 50 stood at 22,668.35, down 81.40 points or 0.36 per cent, having opened at 22,678.00.

The trading session featured choppy price action following a gap-down opening. According to market updates from SBI Securities, sharp selling pressure in heavyweight information technology stocks and Reliance Industries heavily weighed on market sentiment, even as broader markets and select defensive sectors held their ground. Nifty Pharma emerged as the best-performing sectoral index, while Nifty IT remained the worst performer.

On the Nifty 50 gainers' board, Larsen & Toubro led the performance, rising 4.21 per cent to ₹3,819.50 with a surge in volume. Other notable gainers included Apollo Hospitals, up 3.38 per cent to ₹8,055.00, SBI Life Insurance, InterGlobe Aviation (IndiGo), and BSE Ltd. Conversely, Infosys led the decline among losers, falling 3.82 per cent to ₹1,118.60 with 87.77 lakh shares changing hands. State-run ONGC dropped 2.45 per cent, Tata Consultancy Services slipped 2.13 per cent, Reliance Industries fell 1.96 per cent on enormous volumes, and Tech Mahindra shed 1.93 per cent.

Despite benchmark index weakness, overall market breadth on the BSE remained constructive. Out of 4,316 stocks traded, 2,945 advanced against 1,140 declines, yielding an advance-decline ratio of nearly 2.6:1. A total of 57 stocks hit 52-week highs, while 139 touched 52-week lows, indicating relative underlying strength in the broader segments of the market.

Commodities also saw notable movements, with MCX crude oil trading up 1.51 per cent near ₹9,641 and WTI crude near $101.20. Geopolitical risks, including potential supply concerns and shipping security in the Strait of Hormuz, continued to influence energy markets. COMEX gold eased 0.37 per cent to around $4,060, capped by a firmer US dollar and a 10-year US Treasury yield holding near 4.99 per cent. The domestic currency, the Indian rupee, traded near 95.01 against the dollar, pressured by elevated crude prices and foreign equity outflows, though likely intervention by the Reserve Bank of India helped limit steeper declines.

All market focus now shifts to the Federal Reserve's policy decision later in the day. Markets are pricing in an approximately 82 per cent probability of a rate hold at 3.75 per cent to 4.00 per cent, with accompanying policy guidance expected to heavily influence near-term trends across equities, currencies, and bullion.

"The mid-session market trend reflects a classic tug-of-war between weak frontline heavyweights like IT and Reliance, and a surprisingly resilient broader market with a positive advance-decline ratio. When benchmark indices face headwinds from global uncertainties and macroeconomic events like the Federal Reserve decision, selective buying in defensive sectors often cushions the impact. Investors and entrepreneurs should closely monitor global cues, currency movements, and commodity trends, as these external factors continue to dictate near-term domestic liquidity and risk appetite." — Dr. Shishir Gupta, Founder & CEO, StartupLanes