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Indian equity markets ended lower for the third consecutive session on Wednesday as ongoing geopolitical tensions kept investors on edge and selling pressure in automobile and oil marketing company stocks weighed on overall sentiment. 

At the close of trade, the Sensex slipped 102.20 points, or 0.12 per cent, to settle at 84,961.14. The Nifty also closed in the red, falling 37.95 points, or 0.14 per cent, to end at 26,140.75.

“A sustained move above 26,300 would be required to reinvigorate upside momentum toward the 26,500 level, while a decisive break below 26,000 could trigger a short-term corrective phase toward the 25,900–25,800 zone,” a market watcher stated.

Despite the recent weakness, global brokerage Morgan Stanley remains optimistic about the medium-term outlook for Indian equities.

Under its base-case scenario, the brokerage has set a Sensex target of 95,000 by December 2026 -- indicating an upside potential of around 13 per cent from current levels.

In a more optimistic bull-case scenario, Morgan Stanley sees the Sensex climbing to 107,000, which would translate into a gain of about 25 per cent.

On the Sensex, shares of Maruti Suzuki, Tata Motors’ passenger vehicle arm, Power Grid, Hindustan Unilever, Asian Paints and Tata Steel were among the biggest losers of the day.

On the other hand, buying interest was seen in Titan Company, HCL Technologies, Infosys, Tech Mahindra and Sun Pharma, which helped limit the overall downside.

Broader markets performed better than the frontline indices. The Nifty Midcap 100 index rose 0.45 per cent, while the Nifty Smallcap 100 gained 0.39 per cent.

Sectorally, auto and oil and gas stocks remained under pressure, with the Nifty Auto and Nifty Oil and Gas indices posting the sharpest losses.

In contrast, the Nifty Consumer Durables and Nifty IT indices led the gains, with the IT index rising as much as 1.87 per cent during the session.

Analysts said that market participants remained cautious amid global uncertainties, even as longer-term forecasts continue to point towards potential upside in Indian equities.

“In this macro backdrop, equities are likely to stay range-bound; a “buy-on-dips” strategy focused on large-cap themes appears prudent," an analyst said.