IT Stocks Drag Benchmarks Along with Metals as Financials Show Calm Ahead of RBI Policy

Mumbai, June 4: Indian benchmark indices ended largely unchanged on Thursday as weakness in information technology and metal stocks offset gains in consumer, pharmaceutical, banking and energy counters. Investor sentiment remained cautious amid lingering uncertainty over the Middle East conflict and ahead of the Reserve Bank of India’s monetary policy decision on Friday.  

The Sensex rose 13.84 points to 74,360.01, while the Nifty 50 gained 10.95 points to close at 23,416.55. Broader markets continued to outperform, with the Nifty Midcap 100 and Nifty Smallcap 100 indices advancing about 0.5% each.  

Infosys, Hindalco weigh on market 

Nifty IT kept playing spoilsport even today as investors booked profits after recent rally. Source: NSE 

Technology shares emerged as the biggest drag on the benchmarks as investors booked profits after the sector’s recent rally. Infosys was the top loser on the Nifty, while the broader IT pack remained under pressure amid weak global technology sentiment following a sell-off in U.S. chipmaker Broadcom and concerns over AI-related spending. Infosys share price dropped 1.7% while Tata Consultancy Services share price edged down 0.03%. Wipro share price clocked marginal gains of 0.11%. 

Metal stocks also weighed on sentiment, with Hindalco Industries featuring among the key laggards on the Nifty 50 as investors reduced exposure to cyclical sectors amid uncertainty over global growth and geopolitical risks. Hindalco Industries share price went down 1.2% while Steel Authority of India Limited share price bled more than 3%. Although Adani Enterprises advanced to join the top gainers list on Nifty 50, its rise could not prevent weakness among metals. 

The Nifty IT index ended lower, making it one of the worst-performing sectoral gauges of the day. The IT sector slipped about 0.3%, contrasting with gains across most other sectors.  

Consumer and defensives help  

Buying in consumer and defensive stocks helped the market recover from early losses. 

Titan Company emerged as the top gainer on the Nifty, supported by strength in consumer discretionary names. Titan Company share price rose over 3%.  

Pharma index showed an uptick as well with Cipla ending up among top gainers on the Nifty 50. Cipla rose 1.7% as investors rotated into defensive pharmaceutical stocks amid global uncertainties.  

Sectorally, consumer durables, capital goods, media, pharmaceuticals, oil & gas, banking and energy stocks attracted buying interest.  

Financials steady ahead of RBI decision

Nifty Financial Services index didn’t flinch much ahead of central bank policy tomorrow, offering some support to the broader markets. Source: NSE  

Financial stocks gained about 0.3%, providing support to the benchmarks ahead of the RBI policy announcement. Banking shares traded with a positive bias as investors positioned for the RBI’s policy outcome. State Bank of India, for example, rose 0.9%. Markets widely expect the central bank to keep the repo rate unchanged at 5.25%, although commentary on inflation, liquidity conditions and the rupee will be closely watched. 

The policy assumes greater significance as elevated crude oil prices and recent weakness in the rupee have raised concerns about inflation. Although oil prices eased from recent highs following a ceasefire agreement between Israel and Lebanon, investors remained cautious as tensions between the U.S. and Iran continued to cloud the outlook.  

Broader markets remain resilient

Nifty Midcap 100 rose 0.46%, outperforming frontline indices and showing underlying resilience in markets. Source: NSE 

Despite pressure on large-cap IT and metal stocks, the broader market remained firm, signalling continued investor interest in domestic growth themes. 

The advance in mid-cap and small-cap shares, coupled with gains in 13 of the 16 major sectoral indices, underscored the market’s resilience even as geopolitical uncertainties and global volatility kept benchmark indices range-bound.  

With the RBI policy decision due on Friday and crude oil prices remaining a key variable, investors are likely to remain focused on rate-sensitive banking stocks, domestic consumption plays such as Titan, and defensive names including Cipla, while sentiment in export-oriented IT companies such as Infosys could continue to depend on global cues. 

Source: NSE