It was another lackluster day for the Indian stock market, as both frontline indices closed flat, with pressure from tech stocks continuing to weigh on sentiment amid concerns over the H-1B fee hike and a drop in select heavyweight banks, which offset gains in the auto sector
The broad-based weakness led the Nifty 50 to close 0.07% lower at the 25,182 level, while the S&P BSE Sensex finished at 82,149, down 0.05% from the previous close. The broader markets also ended lower, with the Nifty Midcap 100 and Nifty Smallcap 100 losing up to 0.60% each.
Last week’s market rally was put to the test after Donald Trump announced an increase in H-1B visa fees to $100,000, raising concerns that it could lead to higher costs and potential delays in deploying skilled workers to the US.
Some experts view this as a tax on the service sector, following the White House’s imposition of hefty tariffs on imported goods from major trading partners, including India. Meanwhile, analysts do not expect a major impact on earnings, as Indian companies have reduced their dependence on H-1B visas over the last decade, driven by US localisation and increased local hiring.
However, given IT companies muted top-line growth in recent quarters, the latest fee hike has created significant uncertainty for the sector, causing investors to stay away.
“Sentiment remains fragile as Trump’s proposed $100,000 ‘one-time payment’ H-1B visa fee and tariff threats weigh on hopes of an India-US trade deal, stirring anxiety in the Nifty IT index,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.
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