However, buyers returned in the latter half of the session, triggering a sharp rebound of more than 300 points from the day’s low. The Nifty eventually settled at 23,405, down 78 points.
Among Nifty constituents, Apollo Hospitals, Tata Motors and InterGlobe Aviation (IndiGo) emerged as the top gainers, while IT heavyweights TCS, Tech Mahindra and HCLTech were among the biggest drags on the index.Sectoral performance remained mixed. PSU Banks, Private Banks, Healthcare and Pharma stocks outperformed, while IT, FMCG and Realty counters came under pressure.
The Nifty IT index plunged more than 5% amid concerns over AI-led disruption and its potential impact on the traditional outsourcing business model.
The broader market also recovered from intraday lows. The Nifty Midcap 100 and Smallcap 100 indices rebounded over 1.5% from their weakest levels but still ended the session with modest losses of 0.42% and 0.11%, respectively.
Meanwhile, the Indian rupee weakened for a second straight session, depreciating 44 paise to close at 95.70 against the US dollar. The currency remained under pressure amid persistent capital outflows, uncertainty surrounding US tariff proposals and higher crude oil prices driven by escalating tensions in West Asia.
According to Siddhartha Khemka of Motilal Oswal, markets are likely to remain volatile in the near term as geopolitical tensions in West Asia keep crude prices elevated and continue to weigh on foreign investor sentiment.
Investor caution is also expected to persist amid limited progress in US-Iran negotiations, which has raised concerns over energy supplies, inflation and global economic stability.Market participants will closely track crude oil prices, FII flows, rupee movement and the outcome of the RBI Monetary Policy Committee meeting for further direction.
From a technical perspective, Nandish Shah of HDFC Securities said the Nifty is showing signs of indecision after correcting more than 900 points from its recent swing high of 24,089.
According to Shah, the day’s low of 23,151 will act as a crucial support level, while 23,800 remains a key resistance zone. He believes traders can consider long positions as long as the index holds above the day’s low.
Hitesh Rathi of Angel One said the Nifty continues to trade within a broader range, with buyers once again defending the critical 23,200-23,100 support zone.
The sustained defence of this area improves the prospects of a near-term recovery. However, upside momentum may face hurdles at 23,550-23,600 initially, followed by a stronger resistance zone between 23,700 and 23,900, where the 20-day and 50-day exponential moving averages are currently placed.
Unless these levels are decisively crossed, the broader range-bound structure is likely to remain intact, he added.
Rupak De of LKP Securities said the index staged a strong recovery during the day but failed to reclaim the 20-hour EMA, keeping the possibility of renewed downside pressure alive.
According to De, the short-term trend remains weak, and a fall below 23,300 could drag the index towards 23,000. On the upside, 23,600 remains the immediate resistance level.
Bank Nifty also recovered sharply after a weak start. The index opened with a gap-down and traded within a falling channel during the first half before breaking out and closing at 54,186, up 0.88%.
Sudeep Shah of SBI Securities said the 54,600-54,700 zone will be the immediate hurdle for Bank Nifty. A sustained move above this range could extend the recovery towards 55,100 and subsequently 55,500. On the downside, immediate support is placed in the 53,800-53,700 zone.
