Today’s standout performer was the Nifty IT index, which surged 4.3 per cent, with Infosys and TCS gaining up to 6 per cent each | Photo Credit: VIVEK PRAKASH

Benchmark indices reversed a four-session losing streak on Tuesday, with the Nifty IT index leading a sharp intraday recovery that pulled markets out of early losses driven by geopolitical concerns and foreign institutional selling. Besides, short-covering and value buying in select index heavyweights also helped market recovery.

"The rebound was primarily driven by buying in heavyweight stocks across sectors despite persistent geopolitical uncertainty in the West Asia and continued foreign institutional selling," said Ajit Mishra, SVP Research at Religare Broking.

The BSE Sensex closed at 74,649.84, up 382.50 points or 0.52 per cent, while the Nifty 50 settled at 23,483.55, gaining 100.95 points or 0.43 per cent. The Nifty Midcap 100 rose 0.19 per cent and the Smallcap 100 gained 0.40 per cent.

However, despite today’s gains South Korea pushed India to seventh place in market-cap. Within a few days, semiconductor-heavy Taiwan ($5.15 trillion) and now South Korea ($5 trillion) overtook India ($4.85 trillion), as FPIs remained massive sellers of domestic stocks. On Tuesday, FPIs sold shares worth ₹8,363 crore, taking the total selling to nearly ₹2.5 lakh crore in the current calendar year alone.

Tech surge

Today's standout performer was the Nifty IT index, which surged 4.3 per cent, with Infosys and TCS gaining up to 6 per cent each. The rally was driven by positive commentary from global technology companies on AI-led demand, improving revenue visibility for Indian IT exporters, and a weakening rupee that benefits dollar-earning companies. IT stocks have now gained over 7 per cent across the last three sessions.

Markets opened with a gap-down and touched an intraday low near 23,229 before staging a recovery of over 300 points through the afternoon. Short covering ahead of the weekly Nifty expiry contributed to the bounce. India VIX declined roughly 7 per cent to 16.03, signalling improved near-term risk sentiment.

Sectoral trends

On the sectoral front, Consumer Durables, FMCG, Auto, PSU Banks, Metals, and Realty ended in positive territory. Healthcare, Pharma, and Oil & Gas were the session's notable laggards, with the Pharma index shedding nearly 1 per cent on profit booking.

On the macro front, India's industrial production grew 4.9 per cent year-on-year in April 2026 under the revised IIP base year, with capital goods growth reinforcing the view that the domestic capex cycle remains healthy. India-US bilateral trade agreement negotiations are underway in New Delhi from June 2-4, with reports suggesting most key elements have been finalised.

Rahul Singh, CIO – Equities, Tata Asset Management, said geopolitical tensions continue to keep crude oil prices elevated, while mixed global signals have resulted in bond yields remaining high and the rupee staying under pressure. This has increased the risk premium on Indian equities and weighed on market valuations. “Despite these challenges, the impact on corporate earnings has been manageable so far, and management commentary during the fourth-quarter earnings season has remained encouraging,” he said.

The rupee weakened to around 95.26 against the dollar, down approximately 0.35 per cent, as elevated crude oil prices renewed pressure on the currency and raised concerns over India's import bill. International crude eased over 2 per cent to near $90 per barrel after markets reassessed the risk of an immediate Middle East escalation. Gold gained around 2 per cent and silver advanced over 1 per cent as investors remained cautious ahead of US nonfarm payroll data due later this week.

Looking ahead, investor attention will centre on the Reserve Bank of India's monetary policy outcome, with rate-sensitive sectors expected to stay active. Key US data releases, including nonfarm payrolls and the S&P PMI, along with EU CPI figures, are also on watch. Analysts note that a sustained move above 23,650 on the Nifty would be needed to extend the recovery, while the 23,200–23,300 zone remains the critical support area to defend.

Published on June 2, 2026