Sensex, Nifty open lower amid weak Q2 earnings dampen Diwali week

At 9:54 am, the NSE Nifty50 shed 109.60 points to 24,225.55 points, while the BSE Sensex fell 369.17 points to 79,635.87.

In Short

• Sensex and Nifty open lower after Monday's brief rally
• Bharti Airtel, Indian Oil shares fall after weak Q2 earnings
• Domestic investors support market amid foreign institutional outflows

Benchmark stock market indices opened lower on Tuesday, following Monday’s rally after six days of declines. Caution lingered amid an underwhelming earnings season and consistent foreign investor outflows.

At 9:54 am, the NSE Nifty50 shed 109.60 points to 24,225.55 points, while the BSE Sensex fell 369.17 points to 79,635.87.

The Nifty50 and Sensex saw gains on Monday, driven by ICICI Bank’s stronger-than-expected quarterly results, but momentum stalled as eight of the 13 major sectors recorded losses.

Information Technology (IT) and Auto sectors led the declines during early trade today. Small- and mid-cap indices, largely focused on the domestic market, remained mostly flat.

Investor sentiment was influenced by global factors, including upcoming US jobs data and uncertainties around the US presidential election. “Caution prevails due to a lackluster earnings season, ongoing foreign outflows, and premium valuations being questioned amid concerns around FY25 growth,” noted Prashanth Tapse, Senior VP of Research at Mehta Equities.

The Nifty 50 has dropped about 7.4% since hitting record highs on September 27, as foreign institutional investors (FIIs) have been net sellers for 21 consecutive sessions, withdrawing $10.6 billion in October alone—a record monthly outflow.

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted that despite heavy FII selling, domestic retail investors are showing renewed buying interest, indicating a potential shift in sentiment.

In stocks, Bharti Airtel lost 2% after posting lower-than-expected profits, while Indian Oil Corp also dropped 2% after a decline in quarterly profits. On the upside, Federal Bank surged 6.1%, leading the Nifty Bank index’s 0.2% rise after reporting higher profits.

Optimism surrounds this Diwali week as oil prices dip below $68 per barrel after Israeli airstrikes in the Middle East avoided critical Iranian sites, easing concerns about energy disruptions. Monday’s gains in banking stocks, including ICICI Bank and Bandhan Bank, reflect market confidence, though traders remain vigilant amid FII selling pressures and global uncertainties.