Indian Stocks Close Lower

Indian stocks closed sharply lower on Wednesday, tracking overnight losses for software companies in Wall Street. The S&P/BSE Sensex dropped 0.9% to 76,755 and the NSE Nifty 50 fell 0.8% to 23,996. Infosys lost 2% and Tech Mahindra dropped 1.2%, aligned with the pullback in the US AI software sector due to unease of higher borrowing costs and worries that elevated infrastructure spending may not bring the expected returns. In the meantime, higher yields also pressured banks, with Axis Bank and ICICI Bank dropping 2% and 1.5%, respectively. More strikes between the US and Iran, in addition to Houthi forces threatening tankers in the Red Sea, furthered the energy supply shortage from the Middle East. Besides raising the inflationary backdrop, the developments pressure the rupee due to the high import burden of energy commodities, driving foreign investors to divest from Indian equities.

The SENSEX Index dropped 721 points or 0.93 percent on Wednesday to close at 76750 points. Losses were led by Infosys (-2.00%), Axis Bank (-1.96%) and UltraTech Cement (-1.85%). Offsetting the fall, top gainers were Nestle India (3.24%), Indusind Bank (0.98%) and Power Grid (0.80%).

India’s BSE Sensex fell about 0.8% to 76,876 on Wednesday, marking a third straight session of losses, as surging crude oil prices and cautious sentiment ahead of key corporate earnings weighed on investor appetite. The decline came after Brent crude climbed to around $92 a barrel, its highest level in five weeks, amid escalating Middle East tensions that raised concerns over potential supply disruptions. Among recent earnings updates, Bandhan Bank shares dropped about 14% despite improved profit and asset quality, while MedPlus Health fell 16.3% after reporting a decline in quarterly profit. Despite the market weakness, foreign portfolio investors remained net buyers, purchasing about 16.5 billion rupees of Indian equities in the previous session, putting July on track to become their first month of net inflows in five months. Domestic institutional investors, meanwhile, were net sellers. Other notable laggards included Gabriel India (-5.7%), SBI Funds (-2.9%), and Cupid (-1.6%).