Mumbai, February 24 The benchmark equity indices, Sensex and Nifty, fell by more than 1% on Tuesday, dragged down by heavy losses in IT stocks amid concerns over disruption caused by artificial intelligence and renewed uncertainties related to trade.
Rising global crude prices, coupled with escalating US-Iran tensions and sluggish global cues, also impacted investor sentiment, traders said.
The 30-share BSE Sensex plummeted by 1,068.74 points, or 1.28%, to close at 82,225.92. During the day, the benchmark fell by 1,359.93 points, or 1.63%, hitting an intraday low of 81,934.73.
The 50-share NSE Nifty declined by 288.35 points, or 1.12%, to close at 25,424.65. In the intraday session, it depreciated by 385.4 points, or 1.49%, hitting a low of 25,327.60.
"Domestic markets witnessed a sharp decline, driven by significant weakness in IT stocks amid renewed global concerns over disruption caused by AI and margin pressures for traditional service providers," said Vinod Nair, Head of Research, Geojit Investments Ltd.
Global trade and tariff worries also resurfaced, with additional pressure arising from Trump's warnings on trade deals and reports of possible national-security tariffs, he added.
Tech Mahindra was the biggest laggard, declining by 6.6%, followed by HCL Technologies, Eternal, Infosys, Tata Consultancy Services, Larsen & Toubro, Trent, Bharti Airtel, HDFC Bank, Bharat Electronics Ltd, and ICICI Bank.
On the other hand, NTPC, Hindustan Unilever, Tata Steel, PowerGrid, Titan, Reliance Industries, Axis Bank, and Sun Pharmaceuticals were among the gainers.
Broader indices also ended in negative territory, with the BSE Smallcap Select Index falling 0.68%, while the Midcap Select Index slipped 0.54%.
Nair further said that realty stocks also came under pressure due to expectations that prolonged stress in the IT sector could weigh on real estate demand and valuations.
In Asian markets, South Korea's Kospi, Shanghai's SSE Composite Index, and Japan's Nikkei 225 benchmark ended higher, while Hong Kong's Hang Seng closed in red.
European stock markets were trading lower in mid-session deals, with Germany's DAX, London's FTSE 100, and Paris' CAC 40 trading down up to 0.27%.
"Meanwhile, escalating US-Iran tensions, marked by embassy staff evacuations and Iran's warnings of wider regional escalation, intensified risk aversion. Overall, markets remain highly sensitive to geopolitical risks and sector-specific pressures, driving investors toward defensive, domestically focused segments," Nair said.
The US equity market ended nearly 2% lower on Monday.
Brent Crude, the global oil benchmark, rose 0.22% to USD 71.66 per barrel.
Foreign Institutional Investors (FIIs) bought equities worth Rs 3,483.70 crore on Monday, while domestic institutional investors were net sellers of stocks worth Rs 1,292.24 crore, according to exchange data.
On Monday, the 30-share BSE Sensex climbed 479.95 points to settle at 83,294.66, while the NSE Nifty advanced 141.75 points to close at 25,713.
