Bengaluru, June 2, 2026, 12:50 IST
- Nifty 50 bounced back to trade in the green by midday, recovering from early losses. IT stocks led the gain.
- Oil held near $94 a barrel. The rupee slipped and foreign selling weighed, keeping the tone shaky.
- The RBI’s June 5 policy decision is now seen as the key domestic event risk.
Nifty 50 recovers after early drop as IT gains offset weakness in oil, banks
Indian shares reversed course by midday Tuesday, with the Nifty 50 rising 0.18% to 23,425.40 at 12:48 p.m. in Mumbai. Tech stocks jumped, outweighing losses in oil and bank names as well as foreign outflows. The index had opened lower, hurt by Middle East tensions and selling from overseas funds.
Nifty and Sensex bounced, breaking a four-session losing streak that had knocked both indexes down almost 3% in early trade. Where the market goes from here is not clear. Some see signs of stabilization, others think it’s just a short burst of buying. Earlier, Reuters said the Nifty dropped 0.44% and the Sensex fell 0.4% by 9:50 a.m., with foreign investors selling 39.12 billion rupees of shares on Monday.
“Traders are still cautious about a broader Middle East conflict and what that could mean for oil supply and higher energy prices,” said Gaurav Garg, research analyst at Lemonn Markets Desk. “Even with some strength in IT stocks, the mood is still down, with foreign outflows adding to the drag,” he said. Reuters
IT stocks — software and outsourcing firms that get much of their sales overseas — led gains. Nifty IT climbed 4.18%, Moneycontrol data showed. Infosys, TCS, HDFC Bank, HCL Tech and Tech Mahindra gave the biggest lift to the Sensex. Reliance Industries, ICICI Bank, Larsen & Toubro, NTPC and Bharti Airtel weighed.
Infosys was up more than 4% in morning trading while Tata Consultancy Services added about 3.5%. Mphasis and LTIMindtree also rose close to 3% each, according to the Economic Times. “Indian IT firms are following suit of American companies like Anthropic and OpenAI by taking up contracts and tie-ups which are perceived as promising by investors,” said Gaurav Sharma, head of research at Globe Capital. The Economic Times
After a tough stretch for the sector, artificial intelligence — or AI, software that can do work usually handled by people — has put pressure on demand for standard IT services. Nuvama said in a note quoted by the Economic Times that it sees “no existential threat from Gen-AI.” The firm said companies still need system integrators to tailor and manage complex technology stacks. The Economic Times
Oil stayed in focus as Brent crude traded at $94.23 a barrel early, holding most of its more than 5% gain from the last session. Traders kept an eye on U.S.-Iran talks and watched ship traffic through the Strait of Hormuz, the main passage for global oil and LNG.
That’s a clear problem for India, a big importer of crude. Rising oil prices can push up the current account deficit—the gap between payments abroad and earnings from exports—and stoke inflation as the rupee stays weak.
The currency last traded at 95.15 per dollar, off 0.2% for the day, Reuters said. Traders pointed to state-run banks selling dollars, probably for the Reserve Bank of India. Barclays, in a note, said the RBI could lift its inflation outlook, cut its growth projection and turn to non-rate steps to back the rupee.
RBI’s Friday decision is the next focus. Almost 80% of economists polled by Reuters see the central bank holding the repo rate steady at 5.25%. Goldman Sachs analysts aren’t expecting a rate hike to support the rupee, but say they are watching for a “hawkish pause” and maybe some moves to bring in more dollar inflows. Reuters
NHPC shares dropped as the government kicked off an offer for sale for up to 6% of the company. The OFS set the floor price at 71 rupees, which is around 8% under NHPC’s last close, according to Reuters. The move lets large holders sell on the exchange.
Big risks remain. If oil prices rise again, the rupee keeps sliding, or foreign institutional investors continue to sell, the IT-driven rebound on Tuesday might not hold up for the broader market. “Volatility in global bond yield and commodity prices, along with the ongoing West Asia crisis, increased concerns over crude oil prices, inflationary pressures and overall global risk appetite, leading to profit booking across sectors,” said Ajit Mishra, senior vice-president for research at Religare Broking. business-standard.com
