Sensex Falls Over 500 Points as Infosys Cuts Guidance and IT Shares Slide

Updated 12:24 UTC

The final closing numbers for Monday are now confirmed and they replace the provisional close reported in the update below. The Sensex ended 482.92 points, or 0.66 percent, higher at 73,606.75, snapping a four day losing streak, the Press Trust of India reported. During the session the index touched a high of 73,606.75 and a low of 72,514.57, a range of 1,092.18 points. The Nifty 50 rallied 153.20 points, or 0.68 percent, to settle at 22,753.20, The Hindu BusinessLine reported. Moneycontrol reported that buying in the final hour lifted both indexes to their highs for the day, with the Nifty Midcap index up 1.2 percent and the Smallcap index up 1.4 percent, and Dr Reddy's Laboratories among the biggest Nifty gainers while Shriram Finance was among the losers.

From the 30 Sensex firms, Adani Ports, Eternal, Kotak Mahindra Bank, Trent, Tata Steel, Bharti Airtel, InterGlobe Aviation and ITC were the major winners, and Bajaj Finance, HDFC Bank, Maruti, HCL Tech and Power Grid were the laggards, PTI reported. Brent crude declined 1.60 percent to 114.8 dollars a barrel, and foreign institutional investors bought equities worth 887.65 crore rupees on Friday, according to exchange data cited by PTI. Vinod Nair, head of research at Geojit Investments, said Indian equities recovered from early losses, supported by value buying and strength in metal, power and healthcare, while elevated crude prices, geopolitical uncertainty and caution ahead of the Fed, ECB and BoJ policy decisions kept sentiment measured.

Updated 09:56 UTC

Indian benchmarks reversed their morning fall and closed higher on Monday. The Sensex, which had fallen as much as 574 points in the morning after Infosys cut its guidance, closed at 73,285.15, up 161.32 points or 0.22 percent, MarketsMojo reported in its closing wrap. The recovery was already clear by mid afternoon. At 2:31 pm IST the Sensex stood at 73,443.56, up 319.73 points or 0.44 percent, and the Nifty 50 was at 22,698.85, up 98.85 points, The Hindu BusinessLine reported. BusinessLine said fresh buying and short covering in pharmaceutical, metal, realty, private bank and oil and gas shares drove the turnaround, and crude oil prices eased during the session. Dr Reddy's Laboratories was the top Nifty gainer at 3:12 pm IST, up 7.07 percent, while Shriram Finance, whose morning fall this article reported, remained the top loser, down 4.53 percent, BusinessLine reported. BSE Healthcare led the sector gains, up 1.64 percent, and breadth across the BSE 500 was positive, with 302 shares advancing against 195 falling, MarketsMojo reported.

Indian shares fell sharply on Monday morning, October 26, after Infosys cut its fiscal 2027 revenue growth forecast and its shares dropped 2.7 percent in early trading. By mid morning the Sensex had fallen as much as 574 points and the Nifty 50 had touched an intraday low of 22,397, Upstox reported at 09:28 IST. IT shares led the fall.

Infosys cut drives the IT fall

Infosys cut its fiscal 2027 revenue growth forecast to 1 percent to 2 percent, from 1.5 percent to 3 percent, Reuters reported. Most analysts had expected only a trim of the upper end to 2.5 percent. Reuters reported weakness in its North America business.

The Hindu BusinessLine second quarter live blog, at 09:16 IST on October 26, added detail. Revenue grew 1.2 percent quarter on quarter in constant currency, against an estimate of 1.4 percent. The guidance cut includes acquisitions. Operating margin guidance was maintained at 20 percent to 22 percent, and adjusted EBIT margin was 21.0 percent, down 10 basis points and in line with estimates. High tech revenue dipped 10.6 percent and retail dipped 9 percent.

How the morning unfolded

At the open, the Sensex stood at 72,990.04, down 133.79 points or 0.18 percent, and the Nifty slipped 75.60 points or 0.33 percent to 22,524.40, IANS reported. The Nifty IT index was the worst performing sector index at the open, down over 2 percent.

As of 09:24 IST, the Sensex was down 489 points at 72,635 and the Nifty was down 186 points at 22,413, Upstox reported. ICICI Bank, Reliance Industries, HDFC Bank, Bajaj Finance, State Bank of India, Hindustan Unilever and Bharti Airtel also pressured the benchmarks. NSE breadth was negative, with 2,033 shares falling and 1,077 gaining. The Nifty Midcap 100 fell 0.84 percent and the Smallcap 100 fell 1.26 percent.

Shriram Finance falls on a second guidance cut

Shriram Finance was the top Nifty 50 loser in the Upstox report, falling nearly 5 percent to 823 rupees after it cut its assets under management growth guidance to 15 percent to 17 percent, from 18 percent. Reuters reported separately that the shares fell as much as 6.13 percent to 810.20 rupees, an 11 month low, heading for an eighth straight session of declines after the company lowered its annual loan growth forecast and warned of higher credit costs. The two price figures come from different reports at different minutes. Reuters also reported second quarter profit up nearly 60 percent to 36.77 billion rupees, beating the LSEG compiled estimate of 35.46 billion rupees.

A weak week and a soft start in Asia

The benchmarks had fallen in all four sessions the previous week, the Nifty 50 by 2.4 percent and the Sensex by 2.2 percent, on surging oil prices and Middle East tensions, Reuters reporting carried by The Hindu BusinessLine said. GIFT Nifty futures at 22,608 at 07:46 IST on Monday indicated a muted start against the Friday close of 22,600.

Shares were mostly lower in Asia on Monday morning, the Associated Press reported via The Hindu BusinessLine at 08:36 IST. Tokyo Nikkei 225 slipped 0.1 percent to 62,602.86 and Seoul Kospi dropped 1.1 percent to 5,494.29, while Hong Kong Hang Seng edged 0.2 percent higher to 23,137.93. Brent crude fell 1.3 percent to 110.23 dollars a barrel and United States benchmark crude fell 1.7 percent to 101.52 dollars. Upstox put Brent futures around 110 dollars amid attacks on Saudi Arabia over the weekend.