Indian equity benchmarks opened sharply lower on Monday, extending losses from the previous session, as weak global cues and sustained selling pressure in information technology (IT) stocks weighed on sentiment. The BSE Sensex crashed over 500 points in early trade, while the NSE Nifty 50 index fell more than 1%, slipping below the 15,600 mark.
Market Opening Bell: Key Indices in Red
The 30-share BSE Sensex plunged 512.34 points, or 0.97%, to 52,234.56 at the opening bell. The broader NSE Nifty 50 index declined 155.20 points, or 1.01%, to 15,568.30. The sell-off was broad-based, with all major sectoral indices trading in the red.
IT Stocks Under Heavy Selling Pressure
The IT sector was the worst hit, with the Nifty IT index falling over 2%. Heavyweights like Infosys, TCS, Wipro, and HCL Technologies dropped between 1.5% and 3%. The weakness in IT stocks came amid concerns over a potential slowdown in the US economy, which is a key market for Indian IT firms.
Other sectoral indices also witnessed selling pressure. The Nifty Bank index fell 0.8%, while auto, metal, and pharma indices declined 0.5-1.2%. Among the Sensex pack, only a handful of stocks managed to stay afloat, including Hindustan Unilever and Nestle India, which gained marginally.
Weak Global Cues Weigh on Sentiment
Global markets were under pressure as investors remained cautious ahead of key economic data from the US and Europe. Asian markets, including Japan's Nikkei, China's Shanghai Composite, and Hong Kong's Hang Seng, were trading lower, tracking overnight losses on Wall Street. The US markets ended in the red on Friday, with the Dow Jones falling over 200 points, as concerns over rising interest rates and inflation persisted.
Back home, volatility is expected to remain high this week due to the expiry of monthly derivatives contracts and global cues. Analysts advise traders to remain cautious and avoid taking aggressive positions.
Rupee Weakens Against US Dollar
Meanwhile, the Indian rupee depreciated 12 paise to 77.95 against the US dollar in early trade, tracking the weakness in domestic equities and a strong greenback overseas.
Market breadth was negative, with 1,745 stocks declining and 924 advancing on the BSE. The overall market capitalization of BSE-listed firms eroded by over Rs 2.5 lakh crore in early trade.
Investors are now awaiting the release of US consumer price index (CPI) data later this week, which could provide further cues on the Federal Reserve's monetary policy path. Any hawkish stance could trigger further selling in emerging markets like India.
