Last Updated on July 28, 2026 9:14 pm by INDIAN AWAAZ
Investors await Fed policy outcome while falling crude offers support
Indian equity markets ended almost flat on Tuesday after a cautious day of trading, as a strong rally in information technology (IT) stocks offset heavy selling in FMCG, banking and select manufacturing counters. Investors largely avoided aggressive bets ahead of the U.S. Federal Reserve’s monetary policy decision, while easing global crude oil prices helped prevent a sharper decline in domestic equities.
The benchmark BSE Sensex closed 69.86 points lower, or 0.09%, at 76,765.92, while the NSE Nifty 50 slipped 10.60 points, or 0.04%, to settle at 23,985.35, ending marginally below the psychologically important 24,000 mark.
The session reflected the market’s current mood—one of cautious optimism supported by improving global technology sentiment but restrained by concerns over corporate earnings, global interest rates and sector-specific weakness.
IT Stocks Provide Strong Cushion
The biggest support to the market came from the technology sector, which witnessed broad-based buying throughout the session.
The Nifty IT Index surged 3.32%, extending its gains to more than 6.6% over the last three trading sessions, making it one of the strongest-performing sectoral indices this week.
Market participants attributed the rally to a combination of factors:
- A major foreign brokerage upgraded the Indian IT sector from “Underweight” to “Neutral.”
- Infosys was reportedly added to the brokerage’s preferred model portfolio.
- Investors globally shifted allocations from expensive artificial intelligence semiconductor companies to software and IT services firms offering relatively attractive valuations.
- Strong overnight gains in U.S. software companies boosted confidence in Indian technology stocks.
- Coforge soared 10.16% after delivering robust quarterly earnings.
- Tata Consultancy Services (TCS) climbed 4.46%.
- Mphasis advanced 3.57%.
- Tech Mahindra gained 3.49%.
- Persistent Systems rose 3.22%.
- LTIMindtree added 2.82%.
- Infosys, Oracle Financial Services Software, HCL Technologies, and Wipro also posted healthy gains.
Analysts said the sector is beginning to attract fresh institutional buying after a prolonged correction, especially as concerns over global technology spending have moderated.
Coforge Impresses with Strong Quarterly Numbers
Coforge emerged as the day’s biggest Nifty gainer after reporting better-than-expected financial results for the quarter ended June 2026.
- Dollar revenue of $592.2 million, rising 33.3% year-on-year.
- Consolidated net profit increased 63.4% to Rs 518.6 crore compared with the same period last year.
- Gross revenue climbed nearly 49% to Rs 5,527.7 crore.
Although sequential profit moderated due to operational factors, investors welcomed the strong revenue momentum and healthy order execution.
The company’s board also approved, in principle, the establishment of a business entity in China as part of its international expansion strategy.
FMCG Stocks Under Pressure
While IT stocks surged, the broader market faced pressure from heavy selling in consumer goods companies following mixed earnings.
Hindustan Unilever Ltd. (HUL) became the biggest drag on benchmark indices after plunging 7.11%.
- Consolidated net profit declined 3% year-on-year to Rs 2,673 crore.
- Revenue increased 10.3% to Rs 17,184 crore.
- Rising input costs and operating expenses compressed profit margins.
Investors reacted negatively to concerns that elevated raw material costs could continue to pressure profitability in coming quarters.
Similarly, Varun Beverages tumbled 7.53% despite posting healthy revenue and profit growth.
- Revenue growth of 20.4%.
- Net profit increase of 15.1%.
However, investors focused on shrinking EBITDA margins following the consolidation of the lower-margin Twizza business in South Africa.
Banking and Heavyweights Limit Gains
Among heavyweight stocks, ICICI Bank declined 1.94%, while Reliance Industries lost 0.65%, further weighing on benchmark indices.
The combined weakness in financials, energy and FMCG largely neutralised the gains witnessed in technology stocks.
Broader Markets Show Mixed Picture
The broader market also remained subdued.
The BSE MidCap Index ended almost unchanged with a marginal gain of 0.01%, while the BSE SmallCap Index slipped 0.47%, indicating continued profit booking in smaller companies.
- 1,528 stocks advanced
- 2,740 declined
- 169 remained unchanged
The negative breadth suggests that selling pressure remained widespread despite the relatively stable benchmark indices.
Volatility Continues to Ease
The India VIX, widely regarded as the market’s fear gauge, declined 0.77% to 12.56, indicating that investors do not expect significant near-term volatility despite several global events lined up this week.
The relatively low VIX also reflects confidence that markets are unlikely to witness sharp corrections unless major global surprises emerge.
Commodities Offer Some Relief
Global crude oil prices continued their downward trajectory.
Brent crude for September 2026 delivery dropped 2.18% to $86.43 per barrel, providing relief to oil-importing economies like India.
Lower crude prices are generally viewed positively for India’s inflation outlook, fiscal position and corporate profitability, particularly in sectors such as a
Gold prices, however, remained under pressure.
MCX Gold futures for August delivery fell 1.17% to Rs 1,41,395, reflecting the stronger U.S. dollar and expectations that interest rates may remain elevated globally.
Rupee Firms Slightly
The Indian rupee strengthened modestly against the U.S. dollar.
The domestic currency traded around 95.8875 compared with 95.9900 in the previous session.
Bond markets remained largely stable, with the yield on India’s benchmark 10-year government security edging slightly higher to around 6.775%.
Meanwhile, the U.S. Dollar Index remained firm near 101.62, while the U.S. 10-year Treasury yield eased to around 4.62%, reflecting cautious positioning ahead of the Federal Reserve meeting.
Global Markets Await Fed Guidance
Global investors remained focused on the U.S. Federal Reserve’s two-day policy meeting, where policymakers are widely expected to keep benchmark interest rates unchanged.
However, market participants are expected to closely analyse Federal Reserve Chair Jerome Powell’s post-policy comments for indications regarding future rate action.
Interest rate futures continue to indicate expectations that the Fed may consider another rate increase later this year if inflation remains persistent.
Apart from the Fed decision, investors are also awaiting earnings from several major U.S. technology companies, including Amazon, Microsoft and Meta Platforms, which are expected to influence global equity sentiment.
European markets traded higher during the day, supported by encouraging corporate earnings from industrial and consumer companies.
Most Asian markets, however, closed lower amid caution ahead of U.S. policy announcements, with South Korea’s Kospi witnessing particularly sharp losses.
Wall Street had delivered a mixed performance overnight, with the Dow Jones Industrial Average posting gains while the Nasdaq Composite ended slightly lower as investors rotated between technology segments.
Corporate Earnings Drive Individual Stocks
Besides HUL and Coforge, several companies reacted sharply to quarterly earnings announcements.
- R R Kabel, which rose 2.36% after reporting a more than doubling of quarterly profit.
- Om Infra, which climbed 4.78% after emerging as the lowest bidder for a major irrigation infrastructure project in Chhattisgarh.
Stocks under pressure included:
- Godfrey Phillips India, down 7.80% following a sharp decline in quarterly earnings.
- Indoco Remedies, down 7.72% despite returning to profitability, as investor expectations appeared higher.
- Tata Chemicals, which fell 3.73% after reporting a quarterly loss.
- Tejas Networks, down 3.84%, despite nearly doubling revenue due to continued losses.
- Aurionpro Solutions, which declined 11.79% after weaker profit growth.
- Indus Towers, which slipped 1.73% despite posting stable quarterly earnings.
Outlook
Market participants believe Indian equities are likely to remain range-bound in the immediate term as investors digest a heavy earnings calendar alongside important global macroeconomic developments.
The trajectory of U.S. interest rates, movements in crude oil prices, foreign institutional investment flows and domestic corporate earnings are expected to determine market direction over the coming sessions.
While improving sentiment towards the IT sector has provided fresh leadership to the market, analysts caution that sustained gains would require broader participation from financials, consumer stocks and industrial companies.
Disclaimer: This report is based on market data, corporate disclosures and publicly available information as of the close of Tuesday’s trading session. Investors should consult qualified financial advisers before making investment decisions, as stock market investments are subject to market risks.
