The Sensex and Nifty lost early gains to trade lower on Thursday, as IT shares fell after TCS indicated that challenges for the sector remain amid a slowing economy.
The 30-share Sensex opened higher and surged 104 points to a high of 66,577.60, as banking, auto, and metal companies advanced in tandem with favorable global markets.
However, the gains were countered by losses in IT stocks, causing the 30-share index to fall 84.16 points, or 0.13 percent, to 66,388.89 at 9:50 a.m.
The broader Nifty also fell from early highs, closing 23.70 points, or 0.12%, lower at 19,787.65. In early session, it traded between a high of 19,843.30 and a low of 19,784.55.
Rate-sensitive stocks rose after the minutes of the US Federal Reserve’s meeting were released on Wednesday, implying that the US central bank will not raise interest rates in the near future due to uncertain economic prospects.
Among Sensex stocks, IndusInd Bank, Axis Bank, SBI, Tata Motors, JSW Steel, ICICI Bank, Maruti, Tata Steel, and M&M rose in early trade.
However, the gains were offset by a more than one percent drop in IT behemoth TCS, which emerged as the leading Sensex loser.
According to the corporation, the IT sector is still facing headwinds as the economy slows. TCS, the country’s largest software exporter, posted an 8.7 percent increase in net profit for the September quarter to Rs 11,342 crore on Wednesday.
In addition to committing to a nearly Rs 3,300-crore dividend payout, the Tata Group company announced a Rs 17,000-crore share buyback.
Other IT equities, including Tech Mahindra, Infosys, and Wipro, have also fallen. Reliance, HUL, L&T, and Bharti Airtel losses also impacted the benchmark index.
Following overnight gains in US markets, Asian markets, including Japan, China, and Hong Kong, were trading higher. The Hang Seng in Hong Kong climbed 1.75 percent, the Nikkei 225 in Japan gained 1.48 percent, and the Kospi in South Korea gained 0.93 percent.
On the domestic front, the Sensex rose 393.69 points, or 0.6 percent, to close at 66,473.05 on Wednesday, while the Nifty rose 121.50 points, or 0.62 percent, to conclude at 19,811.35.
According to the data exchange, foreign institutional investors (FIIs) continued to be net sellers on Wednesday, offloading shares worth Rs 421.77 crore.
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