The Indian stock market opened on a cautious note on Friday, October 16, 2026, following a sharp rally in the previous trading session. The benchmark indices, the BSE Sensex and NSE Nifty 50, faced early pressure as investors booked profits across several sectors.

During early trading, the Sensex declined by around 100 points, while the Nifty 50 slipped below the crucial 23,000 mark. Market movements reflected mixed investor sentiment, with gains in information technology stocks helping offset losses across other sectors.

Sensex and Nifty Under Pressure

On Thursday, October 15, Indian equity markets recorded their strongest single-day gains in four months. The Sensex surged 1,533.72 points, or approximately 2.11%, to close at 74,315.61. Meanwhile, the Nifty 50 climbed 374.65 points, or 1.66%, finishing at 22,997.35.

However, Friday's session began on a more subdued note as investors assessed the sustainability of the recovery. Early profit-booking weighed on several market segments, while IT stocks provided some support.

YES Bank Shares in Focus

Shares of YES Bank remained under pressure following a significant legal development. On October 15, the Supreme Court upheld the decision to set aside the bank's write-off of ₹8,415 crore worth of Additional Tier-1 (AT-1) bonds.

Following the ruling, YES Bank shares plunged approximately 14.4% on Thursday, closing around ₹18.15. The development raised concerns about the potential financial implications of the judgment and its impact on investor sentiment.

The bank stated that it was examining the judgment and its implications. The ruling is expected to affect the lender's earnings, although S&P Global Ratings indicated that it did not expect the development to affect the bank's credit ratings.

IT Stocks Offer Some Support

Despite the broader weakness, information technology stocks performed relatively well during early trading. The Nifty IT index gained approximately 1.3%, supported by buying in companies including Tech Mahindra.

Tech Mahindra shares rose around 3% in early trading after the company reported better-than-expected second-quarter revenue, supported by strong deal wins. However, losses across several other sectors limited the broader market's momentum.

What Should Investors Watch?

Investors are likely to monitor developments surrounding YES Bank, quarterly corporate earnings, global market movements and changes in investor sentiment.

The 23,000 level remains an important psychological reference point for the Nifty 50. Market participants will watch whether the index can sustain a recovery above this level or faces continued selling pressure.