Indian shares outperform Asia as oil drops, IT rebounds
Friday, 3 July 2026
Indian shares rose on Thursday, outperforming broader Asia as lower oil prices and a rebound in information technology stocks helped shield the market from a global selloff in AI stocks, reports Reuters.
The benchmark Nifty 50 rose 0.71 per cent to 24,175.7, while the BSE Sensex climbed 0.75 per cent to 77,502.12.
Asian stocks slumped 2.4 per cent, with South Korea's tech-heavy KOSPI nosediving about 8 per cent.
"Tech volatility has prompted a search for alternatives, with India ending (June) with ~3 per cent outperformance and up 7 per cent from the lows in early June," global brokerage firm Macquarie said in a note.
Tech-heavy markets like South Korea and Taiwan are undergoing sharp corrections after a blistering AI-driven rally earlier this year, as concerns over stretched valuations prompt investors to pull back.
G. Chokkalingam, founder and head of research at Equinomics Research, said India is emerging as one of the stable markets amid sharp volatility in AI stocks.
"The drop in oil prices is also supporting the momentum towards India. This is the single biggest factor for India as it impacts growth, inflation, forex reserves, fiscal deficit, etc," Chokkalingam said.
Brent crude futures dropped below $71 per barrel after Qatar said Iran and the US had made "positive progress" in indirect talks that concluded on Wednesday.
Thirteen of the 16 major sectors advanced. The broader small-caps and mid-caps rose 1.2 per cent and 0.5 per cent, respectively.
The IT index rose 4.6 per cent to lead sectoral gains. Analysts attributed the rise to value-buying after a 6.5 per cent drop in the last four sessions of falls and a sharp selloff earlier this year due to fears of AI disruption.
Gains were also supported by Federal Reserve Chair Kevin Warsh saying that inflation expectations have declined in the last four weeks.
Tata Consultancy Services and Infosys, India's top two software exporters, gained 4.3 per cent and 5.6 per cent, respectively, on Thursday.
Shares of some mid-sized banks rose after they reported strong growth in advances for the June quarter. Dhanlaxmi Bank and Jammu and Kashmir Bank jumped 5 per cent and 5.4 per cent, respectively.