IT, metal, banking shares tumble; analysts decode key factors

IT, metal, banking shares tumble: Shares of IT, metal and banking shares sectors led the losses in Tuesday's market crash.  Indian markets were roiled as sentiment was hit across the Asian markets after South Korea's Kospi plunged 10%. Investors booked profit in stock market heavyweights such as Samsung Electronics and SK Hynix Inc shares, which sinked over 12% each. 

Ankur Punj, MD & Business Head at Equirus Wealth said, "Markets witnessed a rout due to weak global cues, as the slump in the South Korean benchmark index coupled with lingering concerns over the lack of progress in the West Asia peace deal triggered massive selling in IT, banking, metals and telecom stocks."

Analysts cited the correction in tech and AI stocks to profit-booking in stocks with lofty valuations. 

At home, the BSE IT index crashed 606 pts or 2.24% to 26,408 and Nifty IT index plunged 2.28% or 616 pts to 27,012. 

On Sensex, Infosys, TCS and HCL Technologies were among the top losers, falling 3.36%, 3.16% and 1.79%, respectively. 

Vinod Nair, Head of Research, Geojit Investments  said, "The domestic IT sector remained under pressure, reflecting the global tech rout and persistent concerns over AI-led disruptions in the Indian IT space." 

Banking stocks crash 

On similar lines, BSE bankex plunged 928 pts or 1.42% to 64,432. 

Nifty Bank crashed 752 pts or 1.3% to 57,184. 

Commenting on the outlook of banking stocks and Nifty Bank, Vatsal Bhuva, Technical Analyst at LKP Securities said, "Bank Nifty witnessed strong selling pressure and formed a long bearish candlestick on the daily chart, closing near its crucial 200-DMA support zone."

"The upcoming sessions will be extremely important, as the follow-through price action from current levels is likely to determine the index's near-term direction. A sustained move above resistance or a breakdown below support could provide a clearer trend indication. Until then, traders should maintain a wait-and-watch approach and avoid aggressive directional positions. Immediate support is placed at 56,800, while resistance is seen around 57,500 levels," added Bhuva. 

On BSE bankex, Canara Bank (3.44%), Bank of Baroda (2.94%), IDFC First Bank (2.40%) and AU Small Finance Bank (2.15%)  were the top losers. 

Metal shares lose shine 

The BSE metal index plunged 3% or 1,262 pts to 40,812. Nifty metal index crashed 422 pts or 3.22% to close at 12,669. 

Vinod Nair, Head of Research, Geojit Investments said, "Metals recorded the sharpest decline due to falling global prices and demand concerns amid an uncertain global outlook."

On BSE, metal shares such as National Aluminium (6%), Jindal Steel (4.38%), Hindustan Zinc (4.28%), NMDC (3.39%) and SAIL (3.26%) were the top losers.