Indian equity market ended lower on Monday as a heavy sell-off in information technology (IT) stocks dragged the benchmark indices down. The BSE Sensex ended 466 points, or 0.56%, lower at 82,160, while the NSE Nifty settled at 25,202, down 125 points, or 0.49%.

The broader markets were most affected, with the Nifty MidCap and SmallCap indices falling 0.67% and 1.17%, respectively.

The market sentiment was dented by U.S. President Donald Trump’s administration decision to raise the annual H-1B visa fee from $1,000 to $100,000, a 100-fold increase, which is expected to weigh on the profitability of Indian IT services companies.

"The domestic market traded on a lower note amid a sharp increase in H-1B visa costs, which weighed on the IT index, while mid- and small-cap stocks saw profit-booking following recent gains,” said Vinod Nair, Head of Research, Geojit Investments.

Nair, however, added that GST rationalisation, a normal monsoon, lower interest rates, and tax incentives are expected to support consumption, narrowing the gap between valuations and growth prospects.

“Foreign investors are gradually turning buyers, driven by expectations of earnings upgrades in H2FY25, with consumption-focused sectors likely to attract attention and support the market," he said.

Top gainers and losers

The Sensex constituents displayed a mixed performance today, with select banking and industrial stocks posting gains, while IT majors faced steep declines. Tech Mahindra emerged as the top loser, falling 3.20%, followed by TCS, HCLTech, and Infosys, which dropped between 3% and 1.8%, amid investor concerns over the U.S. H-1B visa fee hike and its potential impact on profitability.

Other notable laggards included Tata Motors (-1.69%), Trent (-1.38%), Reliance Industries (-1.23%), and Larsen & Toubro (-0.92%).

On the other hand, Eternal (Zomato) topped the gainers’ chart, rising 1.55%, followed by Bajaj Finance (+1.31%), Adani Ports (+1.17%), and UltraTech Cement (+0.98%). Axis Bank (+0.73%) and Hindustan Unilever (+0.42%) also contributed to the positive sentiment in the index.

On the sectoral front, Nifty IT was the worst performer, tumbling nearly 3%, followed by Pharma and Healthcare indices. However, gains in Nifty Media and Metal space offered some cushion to the overall market.

Technical outlook

Shrikant Chouhan, Head Equity Research, Kotak Securities opines that as long as the Nifty and Sensex are trading above 25300 and 82500 levels, the weak sentiment is likely to continue. On the down side, the indices could slip till 25100-25050 and 82000-81700.

On the flip side, 25,300/82500 would act as a crucial resistance zone for day traders. If the market manages to trade above this level, it could move up to 25,400–25,425/82800-83000, he added.

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