The Sensex and Nifty opened flat and have since oscillated between gains and losses, struggling to find a clear direction. While financial and IT stocks saw gains, auto and power stocks capped any significant rise.
At 9.40 AM, the Sensex was down 163 points or 0.2 percent at 80,056 and the Nifty was down 66 points or 0.3 percent at 24,405. About 1,154 shares advanced, 1,797 shares declined, and 100 shares remained unchanged.
Uncertainty surrounding the upcoming US Presidential elections, ongoing Middle East conflicts, weak Q2 earnings, and relentless selling by Foreign Institutional Investors (FIIs) have weighed heavily on the Indian stock market, leading to a sharp correction.
"These factors are weighing on the market, and follow-on buying isn't coming through. DIIs have been buying as FIIs sell, but, how much can DIIs really buy? They're motivated because they're sitting on cash, but that only goes so far," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
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He further explained that the vertical rally in September, which took domestic equities to record highs, is now seeing a reversal in October. Since reaching its peak on September 27, Nifty has shed around 7 percent from its all-time high of 26,277.
"FPIs are holding onto cash ahead of the US elections. While we might witness some rebound after yesterday's brutal and broad-based sell-off, it needs to be a robust one, or any rally could quickly fizzle out," Bathini added.
Nifty Bank edged up 0.3 percent, driven by gains in HDFC Bank and Bajaj Finance. Bajaj Finance surged nearly 4 percent after posting a year-on-year increase in consolidated net profit, although it missed street expectations.
Meanwhile, Nifty IT emerged as the top-performing sector, climbing over 1 percent, led by Persistent Systems and Coforge. Shares of both companies jumped 10 percent, following strong Q2 FY25 results that showed a year-on-year rise in consolidated net profit and revenue.
In the broader market, the BSE Midcap and Smallcap indices gained 0.2 percent and 0.4 percent, respectively. The India VIX, or volatility gauge, climbed for the third consecutive session to 15, indicating heightened market uncertainty.
Leading the Nifty 50 gainers, Bajaj Finance, Bajaj Finserv, Bajaj Auto, HDFC Bank, and Adani Enterprises saw gains of 1-3 percent. Meanwhile, NTPC, Power Grid, M&M, Eicher Motors, and Shriram Finance fell 1-2 percent.
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"On the downside, the 24,400 level serves as critical support, and a sustained break below this level could trigger further selling, potentially driving the market toward the 24,200–24,000 range," said Hardik Matalia, Derivative Analyst at Choice Broking.
In the Asia-Pacific region, most markets posted gains today, breaking away from the muted performance on Wall Street, where major indices closed flat as investors monitored Treasury yields and awaited earnings reports to gauge the health of American businesses.
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