Volatility characterized the Indian stock markets on Wednesday, as both benchmark indices opened flat amid cautious investor sentiment in response to weak global cues. Experts indicated that following the completion of the earnings season, market participants will seek direction from international trends and anticipate a pre-Budget rally in the coming ten weeks leading up to the Union Budget 2026, scheduled for February 1.
The Nifty 50 index commenced the day positively at 25,918.10, appreciating by 8.05 points or 0.03 percent. Conversely, the BSE Sensex opened lower at 84,643.78, declining by 29.24 points or 0.03 percent.
Market analyst Ajay Bagga remarked to ANI that Indian equities once again “flattered to deceive” during Tuesday’s weekly expiry, a trading day that usually witnesses significant volatility. “Starting lower, Indian stocks rallied for much of the day only to relinquish most of those gains by day’s end,” he explained.
Bagga noted that even though Asian indices experienced a mild recovery on Wednesday, with limited selling pressure on sectors outside of AI-related stocks, overall market sentiment remains subdued. He added that pre-Budget consultations are ongoing, with various sectors outlining their demands to the Finance Ministry.
Concerns persist regarding lower-than-expected revenue realization. While the government has implemented measures such as income tax and GST rebates to stimulate consumption, a lack of widespread wage growth continues to hinder economic momentum.
Furthermore, Bagga highlighted that the strong political mandate achieved by the government in the Bihar elections provides an opportunity to advance reforms aimed at bolstering economic growth. He also pointed out that a recent agreement between Switzerland and the U.S., which reduces tariffs on Swiss goods from 39 percent to 15 percent, has ignited hopes for progress on an India-U.S. trade agreement.
In addition, India’s substantial purchase order for LPG from the U.S. has been perceived positively by market observers. On the broader National Stock Exchange (NSE), the Nifty 100 rose by 0.04 percent, the Nifty Midcap 100 edged up by 0.02 percent, and the Nifty Smallcap 100 was also up by 0.02 percent. Among sectoral indices, all reported gains except for Nifty FMCG and Nifty Realty; Nifty IT increased by 0.24 percent, Nifty Pharma went up by 0.18 percent, Nifty Auto added 0.06 percent, and Nifty PSU Bank inched up by 0.07 percent.
In the IPO sector, Tenneco Clean Air India is poised to debut on exchanges Wednesday at an issue price of Rs 397 per share, following an impressive subscription of 58.83 times. Internationally, AI-linked risk-off sentiment remained pronounced, as U.S. markets closed lower on Tuesday, with significant pressure on technology stocks.
In related news, Bitcoin briefly dipped below USD 90,000, reflecting a 30 percent decline from its October peaks, marking a negative shift for the year. Additionally, Asian markets experienced sell-offs in technology and AI stocks early on Wednesday.
