The equity benchmark indices traded lower in a volatile session on Monday, dragged by heavy selling in information technology (IT) and pharma shares, even as gains in auto, metal and oil & gas shares provided some support.
Sensex opened weak and fell 475.16 points to 82,151.07. It later pared some losses and was quoting 217.47 points, or 0.26 percent, lower at 82,408.76 at around 12:30 pm.
The Nifty declined 88.95 points in early trade to 25,238.10, before recovering marginally to 25,285.80, down 41.25 points or 0.16 percent.
Adani Enterprises, Bajaj Auto, Adani Ports and Special Economic Zone were among the top gainers in the Nifty pack, rising up to 4 percent, while Tech Mahindra and Tata Consultancy Services declined up to 4 percent.
IT stocks bore the brunt of selling pressure after concerns over H-1B visa issues weighed on investor sentiment. The Nifty IT index slipped over 3 percent in early deals, with Tech Mahindra tumbling nearly 4 percent. Wipro, Infosys, HCLTech and TCS also lost between 2-3 percent.
H-1B visa setback weighs on IT pack and broader index, sending Nifty IT lower by 3 percent
"The market is likely to witness a dualistic behaviour today with the IT sector getting impacted by the H-1B visa issue and the domestic consumption themes responding to the potential big boost to consumption coming from the lower GST rates kicking in from today," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Among sectoral indices, auto, metal, realty and oil & gas advanced up to 1 percent after the GST Council’s new two-tier structure came into effect, reducing rates on several goods and services.
"We have already announced that we will pass on the benefits of rate rationalisation to consumers including price cuts across our food categories effective from September 22. We are also informing our trade partners about the ensuing changes. We expect that the timely and holistic GST reforms by the Government would boost consumption of key food products before the festive season," ITC Executive Director Hemant Malik said.
In the broader market, the Nifty Midcap 100 index slipped 0.02 percent, snapping an 11-day winning run. Mphasis, Persistent Systems, Coforge, Glenmark Pharmaceuticals and Voltas fell up to 5 percent.
The Nifty Smallcap 100 index also ended its six-day rally, down 0.3 percent, with Zensar Technologies, Cyient, Sagility, Inventurus Knowledge Solutions and Poonawalla Fincorp among major laggards, dropping up to 4 percent.
In Asia, South Korea’s Kospi, Japan’s Nikkei 225 and Shanghai Composite traded higher, while Hong Kong’s Hang Seng was in the red.
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