The BSE Sensex fell over 200 points, to trade at 85,558, while the NSE Nifty 50 slipped over 50 points, to drop below the session at 26,300 level, reflecting a market caught between supportive domestic signals and global uncertainty.
On the 30-stock Sensex, losses were led by heavyweight technology and banking stocks. Shares of HCL Technologies, Infosys, Tech Mahindra, Tata Consultancy Services and HDFC Bank fell between 1% and 3%, weighing on the benchmark.
In contrast, broader markets showed resilience, with the small-cap index up 0.5% and mid-caps gaining 0.1%.
State-owned lenders outperformed, rising 1.3%, driven by gains in Punjab National Bank and Bank of Baroda, which climbed about 2% each after releasing quarterly updates.
IT stocks, which derive a substantial portion of revenue from the U.S., declined about 1% amid lingering global uncertainty.
Expert views
The year 2026 has begun with major geopolitical developments which can have profound consequences, said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, adding that the “U.S. action in Venezuela has the potential to further destabilise global geopolitics. The Russia-Ukraine conflict is likely to linger longer; there can be worsening of the protests in Iran and how the Iranian regime reacts to that in the context of threat of intervention by Trump; and perhaps even China might use this time of huge uncertainty for annexation of Taiwan. The huge uncertainty and unpredictability of geopolitics will influence the market, too. We will have to wait and watch how things unfold.”
A positive for India from the Venezuelan crisis is that its medium to long-term impact is bearish for crude, said Vijayakumar.
The market is likely to remain resilient in the near-term since we are at all time high and the momentum might support the bulls, Vijayakumar said, adding that “the Bank Nifty is strong and has fundamental support from impressive credit growth. Q3 results of the banking and financials segment will be good.”
FII/DII Tracker
On the institutional front, Foreign Institutional Investors (FIIs) purchased equities worth roughly Rs 290 crore on January 2, while Domestic Institutional Investors (DIIs) were net buyers to the tune of Rs 677 crore.
Global Markets
Asian equities advanced on Monday while oil prices traded unevenly, as investors digested the fallout from U.S. military action in Venezuela ahead of a heavy slate of economic data in the first full trading week of the year.
MSCI’s broad Asia-Pacific index excluding Japan rose 1.2%, while S&P 500 e-mini futures edged 0.1% higher, signalling a cautious but constructive tone across risk assets.
Markets were responding to a dramatic weekend that saw the U.S. detain Venezuelan President Nicolas Maduro, with President Donald Trump saying on Saturday that Washington would place Venezuela under temporary American control.
Regional gains were led by North Asia, with South Korea’s Kospi and Taiwan’s benchmark climbing more than 2% each to fresh record highs. Elsewhere, moves were more restrained. Hong Kong’s Hang Seng Index rose 0.1%, weighed down by Chinese oil majors as an index of Hong Kong-listed energy stocks slid 3.1%. Australian shares added 0.1%.
Crude impact
Oil prices edged higher on Monday as markets assessed whether political turmoil in OPEC member Venezuela could threaten crude flows, following the seizure of President Nicolas Maduro by U.S. forces, even as ample global supply capped gains.
Brent crude futures rose 17 cents to $60.92 a barrel by 0024 GMT, recovering from earlier declines, while U.S. West Texas Intermediate gained 11 cents to $57.43 a barrel.
Rupee vs Dollar
The Indian rupee weakened slightly in early trade on Monday, slipping 4 paise to 90.24 against the U.S. dollar after a difficult week marked by steady dollar demand and limited supply in the local market.
The U.S. dollar index, which tracks the greenback against a basket of six major currencies, was last up 0.1% at 98.55, extending its advance for a fifth straight session.
(with inputs from agencies)