Sensex, Nifty settles lower after volatile trade; Rupee slips to all-time low

Benchmark stock indices Sensex and Nifty closed lower on Tuesday in a volatile trade, dragged by selling in IT and blue-chip private banking shares and foreign fund outflows amid concerns over the steep hike in US H-1B visa fees.

The BSE Sensex closed 0.07 per cent lower at 82,102.10. The NSE Nifty went down by 0,13 per cent to 25,169.50 points. The decline came after Sensex climbed 147.53 points and Nifty by 48.5 points in early trade. During the day, Sensex hit a high of 82,370.38 and Nifty peaked at 25,261.9. 

Moreover, the rupee slumped by 52 paise to hit an all-time low of 88.82 against the US dollar in intra-day trade on Tuesday, as headwinds like enhanced US tariffs on Indian goods, as well as the US H-1B Visa fee hike, dented investor sentiments.

Among Sensex firms, Trent, Tech Mahindra, Hindustan Unilever, UltraTech Cement, Asian Paints, Eternal and ITC were the major laggards. Selling in HDFC Bank and ICICI Bank also dragged the key indices. However, Axis Bank, Bajaj Finance, Maruti and State Bank of India were among the gainers.

"The domestic equity market traded rangebound and ended flat, indicating continuation of the consolidation. Broader sentiment stayed cautious, with small- and mid-cap stocks lagging the benchmarks," Vinod Nair, Head of Research, Geojit Investments Ltd, said.

Sector-wise, autos, metals, and financials gained on signs of robust festive demand post-GST cuts, while FMCG and realty stocks came under pressure from profit booking, Nair added.

Foreign institutional investors (FIIs) offloaded equities worth ₹2,910.09 crore on Monday, according to exchange data.

In Asian markets, Shanghai's SSE Composite index and Hong Kong's Hang Seng settled lower while South Korea's Kospi ended in positive territory. Equity markets in Japan were closed for a holiday.

"The major drag on the market since the 2024 September peak is the sustained FII selling, which, in turn, is being triggered by the high valuations in India and attractive valuations elsewhere. The high valuation differential between India and other markets has enabled the FIIs to move money from India to other markets and profit from it," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.

The scenario will change when India’s corporate earnings start improving, he added.

(With PTI inputs)