Weak global cues, foreign fund outflows, and cautious sentiment drag markets lower; TCS and HCL Tech trade in red.
The Indian equity markets opened on a cautious note on Monday, January 12, 2026, tracking weak global sentiments, mixed crude price movement, and continuous foreign fund outflows. The BSE Sensex began the session on a negative trend, falling 140.93 points to 83,435.31, while the Nifty 50 also slipped 14.25 points to open at 25,669.05.
This subdued start comes after a volatile week where both benchmark indices struggled to maintain momentum amid global uncertainties and sector-specific earnings expectations.
Weak Start Amid Global Headwinds
Domestic equities mirrored the weakness witnessed in most global markets. Uncertainty over the U.S. Federal Reserve’s interest rate path, fluctuating crude oil prices, and renewed geopolitical tensions weighed on investor sentiment. Asian peers also opened mixed, with investors choosing to remain on the sidelines ahead of key macroeconomic data releases scheduled later this week.
Back home, the broader market indices also opened weaker, with the BSE Midcap index declining 0.20% to 46,840.25, and the BSE Smallcap index losing 0.53% to trade near 49,648.44. Market breadth was largely negative — 454 stocks traded in the green, 2,235 were in the red, and 72 remained unchanged during the early trading session, indicating a wide-ranging sell-off across sectors.
IT Stocks in Focus Ahead of Q3
The start of the Q3 earnings season kept investors cautious, particularly regarding performance in the technology sector. Market leaders such as Tata Consultancy Services (TCS) and HCL Technologies traded in the red in early sessions as investors awaited their third-quarter results to assess the impact of global demand slowdown and currency fluctuations.
According to analysts, IT firms are expected to witness margin pressure amid softer discretionary spending by global clients. However, steady deal pipelines and operational efficiency could cushion the downside for larger players like TCS and Infosys.
“IT stocks are likely to stay volatile this week as investors position themselves for the Q3 results. While cost optimization measures and deal wins may provide some support, cautious client spending in BFSI and retail sectors may weigh on expectations,” said an equity analyst with a leading brokerage firm.
Sensex Gainers and Losers
Despite the weak opening, a few heavyweight stocks saw buying interest. Asian Paints, Mahindra & Mahindra, ITC, Sun Pharma, and HCL Tech emerged as early gainers among the Sensex constituents. Asian Paints led the gains with an uptick of 0.65% during the opening session, indicating strong investor confidence in domestic consumption themes.
On the losing side, Bharat Electronics Ltd. (BEL), IndiGo (InterGlobe Aviation), Eternal, Bajaj Finserv, and Larsen & Toubro (L&T) were under pressure. BEL slipped 1.43%, extending its weak performance from the previous week due to valuation concerns and subdued short-term order expectations.
Institutional Flows: FIIs Continue to Sell
Foreign Institutional Investors (FIIs) continued their selling spree in Indian equities, offloading shares worth Rs 3,769.31 crore on January 9, 2026. Persistent foreign outflows have been one of the major factors limiting market upside in recent sessions. In contrast, Domestic Institutional Investors (DIIs) remained net buyers, purchasing shares worth Rs 5,595.84 crore on the same day, offering some cushion to the market.
Market experts note that this tug-of-war between FIIs and DIIs could lead to increased volatility in the short term. “If FIIs continue withdrawing funds amid global uncertainty, markets may not sustain gains easily. However, continued domestic inflows through mutual funds and systematic investment plans (SIPs) could prevent a sharp correction,” said Shrikant Chouhan, Head of Equity Research at Kotak Securities.
Technical Outlook: Key Levels to Watch
Technical indicators suggest a cautious trading range in the near term. According to Shrikant Chouhan, “As long as the market trades below the 50-day SMA of 26,000 for Nifty and 84,900 for Sensex, the weak formation may continue. On the downside, 25,600 for Nifty and 83,700 for Sensex will act as immediate support levels. Breaching these could trigger more selling pressure, dragging the indices toward 25,400–25,300 (Nifty) or 83,100–82,800 (Sensex).”
On the flip side, he added that a move above 25,750 for Nifty or 84,200 for Sensex could lead to a short-term recovery up to 25,850–25,900 and 84,500–84,700, respectively.
For Bank Nifty, the 20-day Simple Moving Average (SMA) level of 59,500 remains crucial. A fall below this level could extend the correction toward 58,800–58,500, while a rebound above 59,500 may open the door for a bounce to 59,800–60,000.
Gift Nifty Signals Weak Opening
The Gift Nifty, viewed as a reliable early indicator of Nifty 50 movements, reflected a negative start to the session. It opened with a dip of 20.5 points at 25,795.50, as compared to the previous close of 25,816, reinforcing expectations of a subdued market opening.
The pre-market signals indicate that traders may prefer a wait-and-watch approach ahead of key events including inflation data, IT earnings reports, and updates on crude oil prices.
Sectoral Performance: Mixed Trend Across Sectors
Among the sectoral indices, FMCG, pharma, and auto witnessed selective buying, while IT, metal, and banking sectors dragged the market lower. Defensive sectors like FMCG and healthcare may continue to attract interest if volatility persists through the week.
The Nifty IT index slipped over 0.4% in early trading, while the Nifty Bank and Nifty Metal indices dipped 0.3% and 0.6%, respectively. The Nifty FMCG segment, however, held marginal gains of around 0.2%, supported by renewed demand optimism in consumer staples.
Outlook: Volatility Likely to Persist
Experts expect the Indian market to remain range-bound through the week, with focus shifting to corporate results and macroeconomic indicators. The IT and banking sectors are likely to remain in the spotlight due to their heavy weightage and ongoing earnings season.
Short-term traders are advised to stay cautious and avoid aggressive positions until clarity emerges on global growth outlook and foreign fund flows. Long-term investors, however, might consider using dips in quality stocks for gradual accumulation.
