Nifty Closes Lower on Crude Oil Spike and IT Selloff, Defended by Banking Stocks

Indian equity benchmarks remained under pressure through Wednesday's trading session, driven by a fresh spike in crude oil prices following an attack on a Saudi Arabian refinery and a broad selloff in information technology stocks. Despite these headwinds, a sharp recovery in banking stocks prevented a steeper market decline.

The Nifty 50 closed down 50.90 points, or 0.22 per cent, at 22,698.85, marking its second consecutive session of losses. The Sensex settled 352.64 points lower at 73,246.03. Over the past five sessions, the Nifty has consolidated within a 22,400 to 22,800 band.

The session experienced extreme intraday swings. After opening at 22,678, the Nifty hit a day's low of 22,497.70 within the first 75 minutes before recovering nearly 280 points, only to give back gains in the final two hours. Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, noted that the index has recorded an intraday range exceeding 200 points in 15 out of the 18 trading sessions since October 1.

Bucking the broader trend, the Bank Nifty index gained 292.50 points to end at 54,267.40. Technical analysts described the movement as a bullish piercing candlestick pattern after the index recovered more than 800 points from its intraday low.

Cash-market turnover on the National Stock Exchange rose 8 per cent from the previous session, aided by Jio Platforms' debut trading volumes of ₹24,265 crore. Jio Platforms, the telecom and digital services arm of Reliance Industries, listed at a premium in what marked India's largest-ever IPO.

Sectorally, IT and oil and gas were the primary laggards, each shedding over 2 per cent, while Nifty MidSmall Healthcare, Consumer Durables, and Auto emerged as top-gaining sectors. Apollo Hospitals and Larsen and Toubro led the Nifty gainers, whereas Infosys and Reliance Industries were among the key laggards.

Broader markets outperformed the headline benchmarks for the third consecutive session. The Nifty Midcap 100 rose 0.43 per cent and the Nifty Smallcap 100 gained 0.9 per cent, with the BSE advance-decline ratio standing at 1.10. Within the Nifty 500 universe, 254 stocks advanced.

Vinod Nair, Head of Research at Geojit Investments Limited, observed that domestic equities traded lower due to supply disruption concerns in the oil market following Houthi attacks on Saudi Arabia. Meanwhile, Ajit Mishra, SVP of Research at Religare Broking, noted that IT stocks faced profit-booking following recent outperformance, alongside downward pressure on realty and energy counters.

In currency markets, the Indian rupee weakened by 10 paise to close at 95.22 against the US dollar amid rising crude prices. Brent crude traded near $114–115 per barrel, while WTI held above $101. COMEX gold traded near $4,060 and MCX gold hovered around ₹1,43,640.

Market participants are closely monitoring upcoming global triggers, including the Federal Reserve's policy decision, the US 10-year Treasury yield, and the outcome of the US midterm elections on November 3.

"Market corrections driven by external macroeconomic factors like crude oil volatility and sectoral profit-booking are part of routine market cycles. The resilience displayed by midcap, smallcap, and banking segments indicates underlying domestic strength. For long-term business builders and investors, periods of high intraday volatility emphasize the importance of focusing on fundamental business value rather than reacting to short-term macroeconomic shifts." — Dr. Shishir Gupta, Founder & CEO, StartupLanes