Mumbai: Indian shares came under pressure on Wednesday as rising crude oil prices and continued foreign investor selling offset gains in information technology stocks. Investors remained cautious as companies reported quarterly earnings and concerns about the wider economic outlook weighed on market sentiment.
The Nifty 50 and the BSE Sensex opened with little movement after recording strong gains in the previous session. During morning trading, the Nifty 50 rose 0.07% to 22,738.05, while the Sensex gained 0.13% to 73,128.50. Both indices moved between small gains and losses as investors assessed the latest corporate results and economic risks.
However, the early stability did not last throughout the trading session. Selling pressure increased during the afternoon, with the Sensex falling more than 400 points and the Nifty 50 dropping below 22,600, according to market updates. The movement showed that investors remained cautious despite the previous day's recovery.
On Tuesday, October 13, the Sensex had gained 1.54% to close at 73,033.78, while the Nifty 50 rose 1.60% to settle at 22,721.95. The recovery was supported by information technology stocks, bargain buying and improved investor sentiment following stronger corporate earnings.
Information technology shares continued to provide some support on Wednesday. The sector had gained 5.2% during the previous session and rose a further 1.2% in morning trading. HCLTech was among the companies attracting attention after reporting better than expected quarterly earnings.
HCLTech reported revenue of ₹35,620 crore for the quarter ended September 30, an increase of 11.5% compared with the same period last year. Its net income rose 21.2% to ₹5,132 crore. The company's results helped support the technology sector, although gains in these shares were not enough to lift the wider market consistently.
Rising crude oil prices remained another concern for investors. Oil traded at around $107 a barrel in the morning market report as traders assessed supply risks linked to fighting between Yemen's Iran aligned Houthi movement and Saudi Arabia, alongside the prospect of increased diesel supplies from Russia.
Higher oil prices can create economic challenges for India because the country depends heavily on imported crude. An increase in international prices can raise the cost of imports and put pressure on the rupee. It can also increase transport and production costs for businesses and add to inflationary pressures if the higher costs are passed on to consumers.
Foreign portfolio investors continued to withdraw money from Indian equities, adding to the pressure on share prices. They remained net sellers for a 13th consecutive trading session on Tuesday, taking their reported year to date outflows to a record $32.52 billion.
Sustained foreign selling can weaken demand for shares and increase market volatility. However, the overall movement also depends on domestic investment, company earnings, economic conditions and expectations about future policy decisions.
Market performance remained uneven during Wednesday's morning session. Eight of the 16 major sectors recorded losses, while small cap and mid cap shares showed little movement. This indicated that the market's cautious mood extended beyond the main benchmark indices.
The Indian rupee also attracted attention after strengthening against the US dollar following measures by the Reserve Bank of India to support currency stability. The central bank's actions included steps affecting dollar demand related to oil imports and tighter requirements for foreign exchange hedging. The rupee's recovery offered some relief, although higher oil prices continued to pose risks for the economy.
Investors are expected to continue watching corporate earnings, crude oil prices, foreign investment flows and currency movements for signs of the market's next direction. The latest developments highlight the difficulty of sustaining a recovery when positive company results are competing with broader economic pressures.
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