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Informist, Wednesday, Oct. 7, 2026

 

By Shruti Nair

 

MUMBAI – Domestic equity sentiment is likely to remain negative in the near term, with stock-specific moves expected as the September quarter earnings season begins. The season starts Thursday, with information technology bellwether Tata Consultancy Services Ltd. scheduled to announce its results.

 

At its meeting on Wednesday, the Reserve Bank of India's Monetary Policy Committee raised the benchmark repo rate by 25 basis points to 5.50%, in line with expectations. The committee also changed its policy stance to "calibrated tightening" from "neutral", suggesting that inflation risks will now take greater precedence, according to analysts.

 

On Wednesday, the Nifty 50 closed 0.8% lower at 22603.05 points, and the BSE Sensex ended 0.6% lower at 72638.70 points. Analysts see near-term support for the Nifty 50 at 22400–22550 points and immediate resistance at 22700 points. Following the RBI'spolicy rate hike, the near-term impact on the market is expected to be selective, with rate-sensitive pockets facing pressure, while banks with stronger balance sheets and liability franchises are likely to remain relatively better placed, Ajit Mishra, senior vice president of research at Religare Broking, said.

 

Most sectors are expected to face margin-related challenges in the September quarter amid greater cost pressures from elevated crude oil prices, according to analysts. Gains are likely to be stock-specific rather than sector-wide. At 1759 IST, December Brent crude futures were nearly $102 per barrel, up 40% from pre-war levels.

 

While the fundamentals of most domestic banks remain robust, as indicated by favourable September quarter updates, investor interest in the sector is likely to remain limited, according to a senior researcher at a top broking firm. A lack of differentiation, coupled with the sector's large number of stocks, has left institutional investors feeling overexposed to the broader banking, financial services, and insurance sector.

 

On Thursday, Nifty 50 major Tata Consultancy Services is set to announce its quarterly results. For the September quarter, the company's consolidated net profit is expected to decline around 2% sequentially to 137.58 billion, according to the average of estimates from 11 brokerages. Its consolidated revenues are expected to grow just 1% sequentially to INR 730.82 billion. Artificial intelligence-related cost pressures, a slower ramp-up of deals, and an unfavourable demand environment are among the factors brokerages expect to weigh on the company's performance.

 

Analysts said the Nifty IT index is in a downward trend, highlighting that TCS's structure broadly mirrors that of the Nifty index. The IT industry is going through a very difficult time as AI companies disrupt full-time-equivalent-based models that traditional IT players operate on, according to a fund manager at a domestic fund house. Most Indian IT services companies were billed based on the number of full-time-equivalent employees, the fund manager said. End

 

US$1 = INR 96.78

 

Edited by Saji George Titus

 

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