The Indian markets gave indications of a volatile session ahead on Tuesday morning. The BSE Sensex started the day below 83,200, tanking more than 50 points, while the NSE Nifty50 began trading around 25,550, slipping almost 30 points, as of 9:15 AM. Sentiment remained fragile amidst worsening geopolitical tensions, weighed down by sustained foreign fund outflows and rising geopolitical tensions, which continued to dent investor confidence.
Notably, in the pre-open session, the Sensex climbed over 50 points and crossed 83,300, and the Nifty stood marginally flat in green and tested 25,600, around 9:05 AM. Both equity benchmarks closed the previous trading session in red, dragged down by sharp losses in heavyweight stocks such as Reliance Industries, Eternal and ICICI Bank, amid rising geopolitical tensions and renewed concerns over global tariffs.
On the Sensex, SBI, Tata Steel, NTPC, Kotak Mahindra Bank, and Adani Ports stood among the gainers. Meanwhile, the laggards included Bajaj Finance, IndiGo, Eternal, Asian Paints, and Tech M.
In the broader markets, indices across the board painted red, and the Nifty Smallcap 250 index bled 0.73 per cent. Sectorally, the Realty and IT indices dominated in red and crashed 1.33 per cent and 0.77 per cent respectively. On the other hand, the PSU Bank and Metal indices stood out among the few in green and rose 0.86 per cent and 0.48 per cent respectively.
Market participants said elevated geopolitical risks, persistent foreign selling and ongoing weakness in the rupee were together weighing on sentiment and were likely to limit any meaningful upside in domestic equities, even during short-lived recoveries.
“Heightened geopolitical tensions, along with persistent foreign investor selling and continued weakness in the rupee, are weighing on confidence and likely to cap any meaningful upside in domestic equities even during short-term recoveries. Steady buying by domestic institutional investors continues to act as a key stabiliser, absorbing selling pressure and helping prevent deeper drawdowns in the market,” said Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm.
Trump's Tariff Threats And IMF's Growth Forecast
Fresh threats from US President Donald Trump over additional tariffs on select European countries triggered a risk-off mood globally, which weighed on domestic equities. Persistent selling by foreign investors and continued weakness in the rupee against the dollar added to the pressure on Indian markets, keeping participants defensive through the session, said Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm.
On the macro front, the International Monetary Fund on Monday raised India’s growth projection for FY26 to 7.3 per cent, up by 0.7 percentage point from its October forecast, citing the economy’s better-than-expected performance.
Institutional activity remained in focus, with Foreign Institutional Investors (FIIs) continuing to pare their exposure to Indian equities. According to exchange data, FIIs sold shares worth Rs 3,262.82 crore on Monday. Domestic Institutional Investors (DIIs), however, remained net buyers, purchasing equities worth Rs 4,234.30 crore.
Across Asian markets, South Korea’s Kospi was trading higher, while Japan’s Nikkei 225, China’s Shanghai Composite and Hong Kong’s Hang Seng were all quoting lower. US markets were shut on Monday on account of a holiday. In the commodities market, Brent crude, the global oil benchmark, edged up 0.11 per cent to $64.01 per barrel.