Sensex Turns Choppy, Nifty Holds Above 25,700 As IT Index Crashes 6% Amid Global Tech Selloff

Volatile trade grips Indian markets as a deep slide in IT stocks drags benchmarks despite supportive cues from trade deals and Budget measures.

Top Summary

What happened: Indian markets swung sharply as the Sensex traded choppy and the Nifty held above 25,700, while the Nifty IT index plunged 6% following a global tech selloff.

Why it matters now: Elevated valuations, weak global tech sentiment, and uncertainty ahead of the February 6 MPC policy meeting are weighing on investor confidence.

What changes for people: Investors may see pressure on IT-heavy portfolios, while sector- and stock-specific moves could dominate in the short term.

Who is affected: IT companies, retail and institutional investors, FII-driven trades, and sectors linked to global demand cycles.

Indian equities opened weak on Wednesday as heavy selling in technology shares dragged benchmarks lower before a modest recovery lifted the Sensex into positive territory. The Nifty maintained levels above 25,700 but remained vulnerable as traders reacted to global cues and domestic valuation concerns.

IT meltdown drives early-market panic

The Nifty IT index tanked 6%, with majors like Persistent Systems and LTIMindtree emerging as top laggards.

The fall mirrors the sharp correction in US tech stocks overnight, where investors rotated into more cyclical, economy-linked sectors.

Analysts warn that the slide in US markets will likely spill over into Indian IT earnings expectations, putting near-term pressure on valuations and growth outlook.

Macro cues: mixed domestic optimism vs global caution

Despite Budget-led tailwinds and new India–US and India–EU trade deals, the broader market remains jittery.

Most Asian markets fell, tracking Wall Street’s decline.

Futures for the S&P 500 were flat.

Nikkei 225 slipped 0.4%, while Hong Kong’s Hang Seng dropped 0.7%.

Commodities offered some relief as gold and silver rallied up to 4% on MCX.

Meanwhile, the rupee weakened by 22 paise to 90.54 against the US dollar in early trade, reflecting continued foreign outflows and risk-off sentiment.

Expert view: rally may not sustain

Chief Investment Strategist VK Vijayakumar noted that Tuesday’s 639-point surge was largely driven by FII short covering and cash-market inflows of ₹5,236 crore.

He cautioned that:

The rally triggered by the US trade deal may fade quickly

Elevated valuations leave little room for upside

MPC’s February 6 meet is unlikely to offer a major trigger

Export-oriented sectors like textiles, apparel, gems & jewellery, and marine processing could see selective price action

Investors were advised to stay with fairly valued large-caps as market volatility persists.

IPO and stock-specific action

The Brandman Retail IPO opened for subscription, drawing early interest with a 5% grey-market premium.

The ₹86.09 crore fresh issue closes on February 6 and lists on the NSE SME platform on February 11.

Other stocks in focus:

Bharat Coking Coal slipped after posting a ₹23 crore loss in Q3

Nazara Technologies dropped after revenue fell 24% and profit 35% in Q3

Commodities remained tense as oil prices rose over 1%, supported by escalating US–Iran tensions in the Strait of Hormuz.