Mumbai, February 24 The benchmark indices Sensex and Nifty fell by nearly 1% in early trading on Tuesday, driven by a sharp sell-off in IT stocks amid rising fears of disruption caused by AI.
In addition, rising crude oil prices and renewed concerns about global trade following US President Donald Trump's latest tariff remarks also weighed on investor sentiment, traders said.
The 30-share BSE Sensex fell by 813.13 points, or 0.97%, to 82,481.53 in early trading.
The 50-share NSE Nifty declined by 230.15 points, or 0.89%, to 25,482.85.
Eternal saw the biggest fall from the Sensex pack, declining by 3.82%, followed by HCL Technologies, Infosys, Tech Mahindra, Tata Consultancy Services, Bharti Airtel, Bajaj Finance, Bharat Electronics Ltd, Trent, Adani Ports, ITC, and Titan.
On the other hand, State Bank of India, Axis Bank, PowerGrid, Asian Paints, Kotak Mahindra Bank, and Tata Steel were among the gainers.
"The trend of weakness in technology stocks stemming from the potential impact of AI continues. The weakness in the ADRs of Indian IT companies indicates that this segment will continue to remain under pressure," V K Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.
He further stated that the State of the Union address by US President Donald Trump later in the day and the message that he would convey will be closely watched by markets globally.
"The EU freezing the deal with the US in light of the tariff changes following the Supreme Court verdict and Trump's warnings to countries backing away from deals indicate that the tariff drama has more in store for economies and markets. We will have to wait and see how this drama plays out," Vijayakumar said.
In Asian markets, the Kospi in South Korea, the SSE Composite Index in Shanghai, and the Nikkei 225 in Japan were trading higher, while the Hang Seng in Hong Kong was trading in the red.
The US equity market ended nearly 2% lower on Monday.
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.
Brent Crude, the global oil benchmark, rose by 1% to USD 72.13 per barrel.
On Monday, the 30-share BSE Sensex climbed by 479.95 points to settle at 83,294.66, while the NSE Nifty advanced by 141.75 points to close at 25,713.
