Sensex slips 100 pts, Nifty below 24,600 as banks & IT weigh ahead of GST meet

Indian benchmark indices Sensex and Nifty slipped on Wednesday, dragged lower by banking and IT shares, as investors turned cautious ahead of a key Goods and Services Tax (GST) council meeting expected to deliver rate cuts on a swath of goods.

The S&P BSE Sensex fell 127.58 points, or 0.16%, to 80,030.30 at the opening bell, while the NSE Nifty 50 dropped 39.3 points, or 0.16%, to 24,540.30.

On the Sensex, shares of Infosys, Bharti Airtel, Bajaj Finance, ICICI Bank and Hindustan Unilever slipped between 0.4% and 1%.

IT firms, which derive a large share of their revenue from the U.S., eased 0.3%, while financials edged 0.1% lower.

In contrast, autos added 0.1% and consumer stocks rose by a similar margin ahead of the GST Council’s meeting later Wednesday, where tax cuts are anticipated to lift consumption.

Broader markets outperformed, with small-cap stocks advancing 0.5% and mid-caps gaining 0.3%.

Expert Views

Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments, said markets are likely to face heightened volatility amid rising global uncertainty, adding that while “there are both positive and negative factors at play,” the risks include continued pressure on exports and related jobs as the chances of the 25% penal tariff on India being withdrawn appear slim given New Delhi’s refusal to “accept Trump’s dictates.”

On the upside, Vijayakumar pointed to India’s Q1 GDP growth of 7.8%, which signals strong momentum that “will be further boosted by upcoming GST reforms.” According to him, this could lead to an upward revision in earnings growth for FY26 and FY27, potentially drawing foreign investors back into Indian equities and sparking a rally “in the coming weeks.”

Vijayakumar said that the outlook could shift dramatically if the U.S. Supreme Court rejects the administration’s appeal on Trump's tariffs. “Volatile days are ahead,” Vijayakumar said, advising investors to remain invested and “gradually accumulate high-quality, fairly valued stocks.”

Anand James, Chief Market Strategist at Geojit Investments, said the Nifty spent much of the first half of trade within the 24,697–24,809 band identified as the upside target earlier, before slipping lower in what he described as “rejection trades.”

“Though Nifty managed to close above 24,550, our optimism has waned compared with yesterday,” James said. A move back above 24,670 could revive upside hopes, but James cautioned that “the downside objectives of 24,200–24,075–23,860 are back on the radar, calling for higher caution than earlier.”

Global Markets

A selloff in long-dated bonds swept into Asia on Wednesday, sending yields higher and pushing investors toward gold, which notched a fresh record as worries over government debt and slowing growth deepened.

Japan’s 30-year government bond yield climbed to an unprecedented 3.255%, tracking overnight moves in U.S. Treasurys and U.K. gilts. Stocks in Tokyo opened weaker, mirroring losses on Wall Street after data showed U.S. manufacturing contracted for a sixth straight month in August under the weight of import tariffs.

Investors are now looking to services data out of Europe for clues on how economies are navigating President Donald Trump’s unpredictable tariff policies, while key U.S. labor readings later this week, including Friday’s nonfarm payrolls, are expected to guide expectations on Federal Reserve policy.

Job openings and private payroll figures in the coming days will provide an early read on the labor market, which has become central to the Fed’s rate-cut debate.

Markets are overwhelmingly betting the central bank will trim rates later this month, with futures pricing an 89% chance of a quarter-point cut, according to Reuters.

Crude Impact

Oil prices held steady in Asia on Wednesday, consolidating gains from the prior session fueled by sanctions, as traders turned their focus to an OPEC+ meeting set for the weekend.

Brent crude slipped 1 cent to $69.13 a barrel by 0032 GMT, while U.S. West Texas Intermediate edged up 4 cents to $65.63.

FII/DII Tracker

On the institutional front, Foreign Institutional Investors (FIIs) sold equities worth a little over Rs 1,159 crore on September 2, while Domestic Institutional Investors (DIIs) were net buyers to the tune of Rs 2,550 crore.

Rupee vs Dollar

The Indian rupee edged up 3 paise from a record low to 88.12 against the U.S. dollar in early trade on Wednesday, defying weakness in other Asian currencies and subdued risk appetite.

The dollar index, which measures the greenback against a basket of major peers, rose 0.07% to 98.47 after a 0.7% jump on Tuesday.