By Bharath Rajeswaran and Indranil Sarkar
(Reuters) -India’s benchmark indexes recovered from a negative start on Thursday, led by IT stocks on optimism over the rise in artificial intelligence (AI) spending in the U.S., while worries over earnings moderation and U.S. tariffs capped gains.
The Nifty 50 was up 0.34% at 23,234 points as of 10:49 a.m. IST, while the BSE Sensex added 0.32% to 76,651.15.
Both the benchmarks lost about 0.3% at the open, before reversing losses, helped by a 2% rise in IT stocks.
IT index has gained 4.1% in two sessions on the back of U.S. President Donald Trump announcing mammoth spending plans for AI infrastructure on Tuesday. The sector earns a significant share of its revenue from the United States.
A post-results rally in Coforge and Persistent Systems, which jumped more than 10% each, also aided gains in the sector.
Wipro climbed 4.3% and was the top Nifty 50 gainer.
Smallcaps and midcaps rose 1.6% and 2% on the day, after losing about 4% each in the last two sessions.
While IT stocks are jumping on AI optimism and earnings delivery from key constituents, “Indian markets continue to remain on uncertain ground on worries over earnings moderation and U.S. tariff threats,” said Sameet Chavan, head of research at Angel One.
Hindustan Unilever lost 2% and was the top loser on the benchmark index after the consumer goods maker projected near-term margins at the lower end of its forecast range due to a moderation in urban demand.
Indian refiner BPCL lost about 1.5% after missing December quarter profit estimates on lower margins and losses in its liquefied petroleum gas (LPG) segment.
Broader concerns also persisted as Trump’s return to the White House has raised worries over the imposition of tariffs on India, a country he said has high tariffs on U.S. products, analysts said.
(Reporting by Bharath Rajeswaran and Indranil Sarkar in Bengaluru; Editing by Sumana Nandy, Sonia Cheema and Janane Venkatraman)
