September 23, 2025 | AI Capital Surge, IT Headwinds, and Market Rotation Signals

Good Morning & Market Recap

Indian markets closed Monday on a weak note, with benchmark indices slipping below key levels and extending the losing streak for a second consecutive session. The selloff was primarily driven by IT stocks facing renewed pressure from potential H-1B visa fee hikes, while global cues remained supportive as US markets posted record highs for the third straight session. Early indications suggest a flat opening, pointing to cautious positioning as investors assess whether domestic markets can stabilize despite persistent sector-specific headwinds. Key watch factors today include IT sector recovery potential, institutional flows, and spillover effects from global tech momentum.

Tech Pulse

Global Tech Surge

Global technology stocks surged as Nvidia rallied to record highs after announcing a massive long-term investment commitment toward OpenAI, reinforcing optimism around AI infrastructure spending. Oracle also gained traction following reports of deeper involvement in managing TikTok’s US operations, supported by regulatory and political momentum.

Indian IT Under Pressure

In contrast, Indian IT majors remained under selling pressure, with large-cap names among the worst performers as concerns mounted over proposed H-1B visa fee increases. Pre-open signals continue to indicate weakness, keeping sentiment fragile across the IT services space.

Sector Impact

The divergence between global AI-led enthusiasm and domestic IT caution is creating selective opportunities. Companies with stronger domestic revenue exposure and lower reliance on US visa deployments may prove relatively resilient compared to peers dependent on traditional offshore delivery models.

Funding Radar

International investor interest in Indian startups remains constructive. A major UK banking group announced plans to invest in early-stage Indian ventures across AI, payments, and digital tools, while expanding its India-based technology workforce. In parallel, recent funding activity spans deeptech, fintech, clean technology, and manufacturing, highlighting sustained confidence across both new-age and industrial segments. The IPO calendar remains active, with several offerings testing market liquidity as investor attention stays divided between primary and secondary markets.

Market Movers & Watchlist

Pre-open trade shows strength in select financial and consumer names, while IT stocks continue to face pressure. Sectoral divergence remains pronounced, with power, oil and gas, and metals showing relative resilience against ongoing weakness in IT and pharma. The session bias remains cautious, with any early bounce likely to be tested by headline sensitivity around visa policy updates and global risk appetite.

Quick Bytes (Global / Off-Radar)

Gold prices touched fresh record highs as expectations of further global rate cuts strengthened, while digital assets faced selling pressure despite broader risk-on cues. Asian markets opened mixed, reflecting regional divergences in growth outlooks. Separately, regulatory discussions around pension fund exposure to alternative assets could create medium-term tailwinds for India’s private markets.

Deep Dive – AI Capital Wave vs IT Policy Headwinds

The technology landscape currently reflects two contrasting narratives. On one hand, unprecedented global capital is flowing into AI infrastructure, reinforcing long-term confidence in compute-driven growth. On the other, Indian IT services firms face near-term regulatory friction from proposed visa cost changes. This contrast underscores the importance of business model evolution. Companies investing in automation, AI-led delivery, and local talent ecosystems may be better positioned to absorb regulatory shocks than those reliant on traditional cost-arbitrage models.

What to Watch Today

Investors will closely track institutional flows, IT sector management commentary on policy impact, and global cues from Asian markets. From a technical perspective, the market’s ability to reclaim recent resistance levels will be critical in determining whether consolidation continues or a relief bounce emerges.

Quote of the Day

“AI capex is becoming the new oil — whoever controls compute shapes margins.”

— Market commentary following the Nvidia–OpenAI investment announcement

Compliance & Disclaimer

This newsletter is for informational and educational purposes only and does not constitute investment advice. Market data is sourced from publicly available information and validated through multiple references. Past performance is not indicative of future results. Readers should consult qualified financial advisors before making investment decisions.

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