Indian Markets Attempt a Rebound as IT Stocks Lead; FII Selling and Oil Remain Key Risks

Indian equity markets attempted to stabilize on Wednesday after two consecutive sessions of declines.

The Nifty 50 was up around 0.2% at 22,762 in morning trade, while the Sensex gained about 0.46% to 72,877.11. Both benchmarks had fallen around 1.8% over the previous two sessions and were down roughly 5.5% during September. Reuters

IT stocks lead the recovery

The Nifty IT index gained around 2.6%, potentially snapping an eight-session losing streak. The move came as expectations of higher US interest rates eased following dovish comments from a Federal Reserve official.

IT companies are particularly sensitive to US interest-rate expectations because a significant portion of their revenue comes from the US market. Reuters

TCS was also among the notable early gainers, rising around 2.5% in early trade. Financial Express

Foreign selling remains a major market factor

Foreign investors remained heavy sellers. Reuters reported that foreign investors sold shares worth ₹99.8 billion on September 29, their largest single-day outflow in roughly four months.

September's foreign equity outflows were reported at around $2.7 billion, taking year-to-date selling to approximately $26.75 billion. Reuters

Domestic institutional buying has provided some offset, with reports showing DIIs bought nearly ₹7,000 crore on September 29. Moneycontrol

Oil remains a pressure point

Brent crude was trading around $103 per barrel. Elevated crude prices are an important consideration for India because higher energy costs can affect inflation, corporate margins and the country's external balance. Reuters

What investors are watching

The immediate market focus remains on:

• Foreign institutional investor flows
• Crude oil prices
• US Treasury yields and interest-rate expectations
• IT-sector performance
• Rupee movement
• The sustainability of the Nifty's recovery after the recent decline

The market is showing signs of stabilization, but the combination of persistent foreign selling and elevated oil prices remains an important risk factor.

Source: Reuters, Financial Express, Moneycontrol