Sensex, Nifty snap 4-day rally as profit booking offsets IT surge; Trent down 12%

Benchmark indices ended slightly lower on Tuesday as profit booking offset strong gains in IT shares. Caution ahead of the US Fed minutes and the earnings season kept sentiment measured, even as the rupee strengthened.

In Short

• Nifty IT index gained 2.43%, led by HCLTech and Infosys
• Indian rupee rose 0.45%, biggest gain in three weeks.
• Trent plunged 12.42% post weak quarterly update

Benchmark equity indices ended marginally lower on Tuesday, snapping a four-session winning streak, as broad-based profit booking offset strong gains in information technology stocks. Investors also remained cautious ahead of the release of the US Federal Reserve's meeting minutes and the start of the June quarter earnings season.

The BSE Sensex fell 104.35 points, or 0.13%, to close at 78,180.72, while the NSE Nifty50 slipped 31.65 points, or 0.13%, to settle at 24,398.70.

The Indian rupee, however, bucked the trend and rose 0.45% against the US dollar to 94.9675, marking its biggest single-session gain in three weeks after strong dollar selling in the non-deliverable forward market triggered short covering.

IT STOCKS BUCK THE TREND

Information technology stocks continued their rebound for the second straight session ahead of the Q1 earnings season, emerging as the biggest support for the market.

The Nifty IT index gained 2.43%.

Among Sensex constituents, HCLTech surged 3.08%, while Tech Mahindra and Infosys gained 2.81% each. TCS rose 1.82%, helping cushion losses in the benchmark indices.

The rally comes after the sector witnessed a sharp correction last week, with investors turning optimistic on easing concerns around US interest rates and attractive valuations ahead of earnings.

Retail major Trent was the biggest laggard of the day, plunging 12.42% after its June quarter business update fell short of Street expectations, triggering heavy profit booking.

Other notable losers included Adani Ports, which declined 1.63%, BEL, down 1.54%, LT, which lost 1.19%, Reliance Industries, down 1.12%, ICICI Bank, which slipped 0.81%, Asian Paints, down 0.76%, NTPC, which fell 0.65%, and Tata Steel, which declined 0.58%.

The broader market also witnessed selling pressure. The Nifty 100 fell 0.22%, Nifty 200 declined 0.23%, Nifty 500 lost 0.28%, Nifty Midcap 100 slipped 0.30%, and Nifty Smallcap 100 dropped 0.55%. The Nifty Midcap 50 ended flat, while India VIX eased 1.43%.

SECTORAL PERFORMANCE REMAINED MIXED

Sectoral indices presented a mixed picture.

Apart from IT, gains were seen in Nifty Consumer Durables, which rose 0.89%, Nifty MidSmall IT & Telecom, up 1.05%, Nifty Financial Services, which gained 0.14%, Nifty Healthcare, up 0.28%, Nifty Pharma, which advanced 0.73%, Nifty PSU Bank, up 0.43%, and Nifty FMCG, which edged up 0.06%.

On the losing side, Nifty Realty fell 1.58%, Nifty Metal declined 1.10%, Nifty Chemicals lost 0.91%, Nifty Healthcare 500 slipped 0.79%, Nifty MidSmall Healthcare declined 0.78%, Nifty Media lost 0.74%, Nifty Healthcare Index fell 0.83%, Nifty Oil & Gas slipped 0.11%, Nifty Auto edged down 0.04%, Nifty Financial Services 25/50 declined 0.06%, Nifty Private Bank fell 0.15%, Nifty Consumer Durables Ex-Bank lost 0.29%, while Nifty MidSmall Financial Services declined 0.38%.

Vinod Nair, Head of Research at Geojit Investments Limited, said, "Profit booking emerged in the latter half of the session as weakness across Asian markets and investor caution ahead of the US Fed minutes weighed on sentiment. However, IT stocks continued to lend support, extending gains ahead of the June-quarter earnings season as the sector recovered from recent corrections."

"With concerns around the US-Iran conflict and trade tariffs easing, market focus is shifting towards Q1FY27 earnings and the progress of the monsoon. Meanwhile, improving FII inflows and a stable rupee are expected to provide near-term support to overall market sentiment," he added.

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