Sensex and Nifty erase gains amid choppy trade; rupee hits fresh low

The equity benchmarks swung sharply through Thursday’s session, with the Sensex and Nifty rising in early trade before losing momentum as investors chose to book profits. The Sensex slipped nearly 400 points from its intraday high, while the Nifty briefly fell below the 26,000 mark before recovering.

By early afternoon, both indices were marginally lower, reflecting a cautious mood as traders reacted to multiple domestic and global triggers. A fresh slide in the rupee was one of the key factors unsettling sentiment. The currency dropped 28 paise to 90.43 against the US dollar, a new low that typically makes foreign investors wary of Indian assets.

Moneycontrol reported that this came on the back of sustained selling by overseas investors, who offloaded nearly Rs 3,207 crore worth of equities on Wednesday, marking the fifth consecutive session of outflows.

The upcoming monetary policy announcement also weighed on market direction. The Reserve Bank of India’s Monetary Policy Committee will reveal its decision on Friday, and although growth remains strong, the weakening rupee has raised questions over whether the central bank might alter its stance.

Market strategists said that investors were closely watching the RBI’s tone, with several highlighting the possibility of heightened volatility around the event. Expiry of weekly derivatives contracts added another layer of instability, as traders squared off positions, leading to quick swings between gains and losses.

Meanwhile, movement in crude oil reinforced the cautious undertone. Brent crude was up 0.35 percent at USD 62.89 per barrel, a level that can influence import costs and inflation outlook in India.

On the stock-specific front, InterGlobe Aviation, Dr. Reddy’s Laboratories and Kotak Mahindra Bank were among the notable laggards, declining up to 2 per cent, while technology majors such as Tata Consultancy Services and Tech Mahindra gained as much as 2 percent.

Technical analysts said that the Nifty’s attempt to recover appeared to have stalled near the 26,000 mark, suggesting that a consolidation phase may be required before the index attempts to move towards 26,111 or break above 26,200.

They added that a fall below 25,935 could indicate a renewed downside. Overall, the trading pattern reflected a market in wait-and-watch mode, torn between strong domestic fundamentals and rising macroeconomic uncertainty.

With Agency inputs