Stock market today: Sensex today slips 200 points, Nifty ends near 25,000 on pullback in IT stocks

Stock market today: Indian benchmark indices closed lower in Friday’s session, May 16, following a seven-month high in the previous trading session, as a sharp reversal in domestic technology stocks pulled the market down. However, losses were limited due to strong gains in realty, media, auto, and consumer goods stocks.

The Nifty 50 ended with a mild cut of 42 points, or 0.17%, to settle above the 25,000 mark at 25,019, while the Sensex fell by 200 points, or 0.24%, to close the session at 82,330. Both indices wrapped up the week with healthy gains of over 4%. Broader markets posted even stronger gains, with the Nifty Midcap 100 rising 7.21% this week and the Nifty Smallcap 100 rallying by an even sharper 9%.

Although the markets took a slight pause in today’s session, defence stocks continued to roar, with shares of Cochin Shipyard, Mazagon Dock Shipbuilders, and Garden Reach Shipbuilders gaining up to 12.1%.

Apart from the improved market sentiment toward defence stocks, their stellar performance in the March quarter has also supported the continued rally in these domestically focused companies.

Meanwhile, this week's blockbuster performance was driven by the trade truce between the US and China and the ceasefire between India and Pakistan, bringing equities back into the investor spotlight.

Additionally, expectations grew that Washington would further roll back steep tariffs on its trading partners following the deal with China, which triggered a sharp recovery rally across major global markets. Following the trade deal, global brokerage firm JPMorgan cut the chance of a US recession, which also supported the rally in equities.

Domestic technology stocks came under pressure in today's session, as fresh U.S. economic data and remarks by Federal Reserve Chair Jerome Powell made investors cautious on IT stocks, causing the Nifty IT index to drop nearly 1% and settle at 37,972 points.

Federal Reserve Chair Jerome Powell said on Thursday that longer-term interest rates are likely to remain elevated as the economy evolves and policy remains uncertain.

“We may be entering a period of more frequent and potentially more persistent supply shocks — a difficult challenge for the economy and for central banks,” he said at a policy conference.

Meanwhile, retail sales in the U.S. barely grew in April, as consumers pulled back on spending.

(more to come)

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