Indian Benchmark Indices Ease as Profit-Taking Weighs on Markets
Mumbai – India’s benchmark equity indices moved lower on Monday as investors engaged in broad profit-taking across most sectors. Despite the decline, gains in major information technology stocks helped limit the extent of the losses.
The Nifty 50 slipped by 0.42% to close at 25,959.50, while the BSE Sensex fell 0.39% to 84,900.71. Both indices are currently trading slightly over 1% below their record highs reached in September 2024.
Even with the mild pullback, the benchmarks have recorded gains in six of the last eight weeks. An improved earnings outlook, higher consumption supported by tax cuts, easing inflation, and strong domestic inflows have contributed to recent market resilience.
Market analysts noted that a pause was expected after a steady upward run in recent weeks. They highlighted that the slight correction reflects natural consolidation as investors secure profits.
Fifteen of the sixteen major sectoral indices ended the session in the red. The broader small-cap index dropped 0.9%, while mid-caps recorded a moderate decline of 0.3%.
IT stocks, however, bucked the overall trend and rose 0.4% during the session. This uptick was fuelled by stronger expectations of a U.S. Federal Reserve rate cut in December, lifting sentiment for export-driven Indian tech companies.
A potential rate cut in the United States would likely boost economic activity and corporate spending. Since Indian IT services derive a substantial share of earnings from U.S. clients, such a move could translate into improved revenue prospects.
Asian markets also saw an upward trend during the session, supported by growing optimism over U.S. monetary easing. Lower interest rates in the U.S. typically encourage greater foreign investment flows into emerging markets, benefiting regional equities.
The Indian rupee strengthened during the day after touching a fresh record low of 89.49 against the dollar on Friday. Traders linked the recovery to timely intervention from the Reserve Bank of India to stabilise currency movement.
Among key individual stocks, Tech Mahindra advanced 2.4% after brokerages reaffirmed confidence in a potential earnings turnaround by fiscal year 2027. The stock gained traction as analysts projected improved profitability driven by operational restructuring.
In contrast, Hindustan Aeronautics witnessed a decline of 3.3% following an incident involving its Tejas fighter jet. The aircraft crashed during an aerial display at the Dubai Airshow, prompting renewed scrutiny of the program.
Market participants continue to monitor global cues, domestic policy signals, and currency trends for near-term direction.
As investors evaluate growth indicators and earnings momentum, volatility may persist in the coming sessions.
Overall, the day’s movement reflected a cautious recalibration rather than a shift in the broader positive outlook. Strong fundamentals, increasing retail participation, and supportive economic conditions remain central themes shaping India’s equity market trajectory.
