Sensex down 350 pts, Nifty below 25,100: US visa concerns among key factors behind market fall

Sensex, Nifty see profit booking in September 23 trade. 

The equity benchmarks gave up early gains to trade lower on Tuesday as selling in index heavyweights, foreign fund outflows and concerns over higher US H-1B visa fees weighed on investor sentiment.

Sensex, which had risen 147.53 points to 82,307.50 in early trade, fell 354.15 points or 0.43 percent to 81,805.82 at around 11:20 a.m.

The broader Nifty climbed 48.5 points to 25,250.85 in opening deals but later traded at 25,088.85, down 113.50 points or 0.45 percent.

UltraTech Cement, Titan, Asian Paints, Adani Ports, Trent and Sun Pharma were among the major laggards.

Key factors behind market decline

1) US visa concerns: IT stocks, which draw a large share of revenues from the US, fell 0.5 percent after a sharp 3 percent drop on Monday. The fall followed the US decision to increase H-1B visa fees, a move seen as impacting Indian IT outsourcing. "There is a bearish tone in the markets after the new H-1B visa fees as the move is likely to disrupt the Indian IT outsourcing model," Hariprasad K, research analyst and founder of Livelong Wealth, told Reuters. Indians accounted for 71 percent of approved H-1B beneficiaries last year.

2) Selling in heavyweights: Index majors such as Nestle India, Tata Consultancy Services, HDFC Bank and Reliance Industries faced selling pressure, dragging the benchmarks lower.

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3) FII outflows: Foreign institutional investors (FIIs) sold equities worth Rs 2,910.09 crore on Monday, adding to the downward pressure on domestic markets.

4) Rupee weakness: The rupee fell 25 paise to a record low of 88.53 against the US dollar in early trade. Traders said higher US tariffs on Indian goods and the H-1B visa fee hike dampened sentiment, while global risk aversion and trade policy uncertainty added to the pressure.

5) Volatility index: The India VIX, also known as the fear gauge, rose 2.11 percent to 10.78, indicating heightened volatility expectations.

Technical view

Anand James, Chief Market Strategist at Geojit Financial Services, said the resumption of the near-term uptrend will depend on whether the Nifty holds the 25,200–25,000 range. "Early moves may retain a positive bias if above 25,238, but it would require a rise above the 25,278–25,335 region to attract momentum. The ideal rest point for the ongoing down move appears to be 24,880–24,800," he said.

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