Equity benchmarks ended on a subdued note on Thursday, erasing intraday gains, as renewed military exchanges between the US and Iran reignited concerns over the durability of the fragile ceasefire, keeping investor sentiment cautious.

The BSE Sensex fell 150.63 points or 0.20 per cent to close at 73,832.55, while the Nifty 50 declined 53.35 points or 0.23 per cent to settle at 23,161.60.

The broader market remained under pressure, with both midcap and smallcap indices ending lower.

Markets witnessed a brief recovery during the session amid easing crude oil prices, but the gains proved short-lived. “Domestic markets witnessed a modest rebound on dip-buying as oil prices eased, despite the recent US–Iran escalation. However, the recovery proved fleeting, weighed down by an increasingly fragile global backdrop,” said Vinod Nair, Head of Research at Geojit Investments Limited.

He added that IT stocks remained under pressure amid concerns that stronger US inflation could delay interest rate cuts and keep global financial conditions tight.

“Global cues remained mixed, with major central banks continuing to signal a hawkish stance. The expected ECB rate hike has further heightened concerns around liquidity tightening and its potential impact on emerging market flows,” Nair said.

“Weakness in the rupee, uncertainty over global interest rates following stronger-than-expected US inflation data, and cautious foreign investor activity further weighed on sentiment. The combination of these factors triggered broad-based profit booking, leading the market to close in negative territory,” Gaurav Garg, Research Analyst at Lemonn Markets Desk, said.

Persistent foreign institutional investor outflows and a weaker rupee also weighed on sentiment.

IT, defence stocks under pressure

Most sectoral indices ended in negative territory, with defence and IT stocks witnessing the sharpest declines. Media emerged as the top-performing sector, while pharma and private banks posted modest gains.

The weakness in technology stocks mirrored the overnight decline in global tech shares. During the session, TCS, Wipro, HCLTech and LTM touched fresh 52-week lows.

Among Nifty 50 constituents, Mahindra & Mahindra, ICICI Bank and Kotak Mahindra Bank were the top gainers. Infosys, HCLTech, Adani Ports, Eternal and Bajaj Finance were among the biggest losers.

US markets ended sharply lower overnight. Wall Street’s recent weakness has been driven by a selloff in AI stocks amid concerns over stretched valuations. Nvidia, Broadcom and Super Micro Computer declined sharply, while Micron remained volatile. Investors are also reportedly reallocating funds ahead of upcoming high-profile US listings, including a potential SpaceX IPO.

Broader market remains weak

Nifty midcap 100 and Nifty smallcap 100 declined 0.7 and 0.8 per cent, respectively. In the midcap segment, Paytm, SRF, Tube Investments and UPL fell 3-4 per cent, while Vodafone Idea, MCX, IRCTC, Lupin and 360 ONE WAM gained 1-3 per cent.

Among smallcaps, Aegis Logistics outperformed, while MRPL, Amber Enterprises, Afcons Infrastructure and Ola Electric declined 4-5 per cent.

Market breadth remained firmly negative. Of the 4,389 stocks traded on the BSE, 1,384 advanced, 2,807 declined and 198 remained unchanged.

A total of 77 stocks hit their 52-week highs, while 119 touched fresh 52-week lows. Additionally, eight stocks hit their upper circuits, while 10 were locked in lower circuits.

Brokerages trim market outlook

Global brokerage Citi lowered its Nifty valuation multiple to 18 times from 19 times earlier and trimmed its Nifty target to 26,000 from 27,000.

The brokerage said geopolitical uncertainties, concerns around artificial intelligence and El Niño-related risks are weighing on foreign institutional investor sentiment towards India. It also flagged the sustainability of strong consumer demand trends seen in the March quarter as a key near-term concern.

However, Citi retained a constructive medium-term view, stating that relatively low investor positioning and a healthy growth outlook could create upside potential if tensions in West Asia ease and foreign investor outflows moderate.

Domestic brokerage PL Capital also revised its Nifty 50 target to 26,449 from 27,080, citing rising crude prices, foreign investor outflows, inflationary pressures and supply chain disruptions as key risks to the near-term growth outlook.

Global cues mixed

Brent crude oil traded lower during the day, while the rupee weakened to 95.76 against the US dollar.

Asian markets ended mixed, with South Korea’s Kospi and Japan’s Nikkei 225 closing marginally higher, while China’s Shanghai Composite and Hong Kong’s Hang Seng settled lower. European markets were trading higher.

According to Sunny Agrawal, Head of Fundamental Research at SBI Securities, investors will closely monitor key global events including the US May 2026 Producer Price Index data, weekly initial jobless claims and the European Central Bank’s interest rate decision.

On Wednesday, BSE Sensex settled 64.42 points or 0.09 per cent higher at 73,983.18. Nifty 50 dipped 27.15 points or 0.12 per cent to end at 23,214.95.

More Like This

Published on June 11, 2026