The Indian stock market faced a challenging session today, snapping its recent rally as global trade tensions resurfaced, dampening investor sentiment. The headline indices, Nifty and Sensex, closed in the red, weighed down by auto, energy, and pharma stocks, while selective buying in IT, FMCG, and realty stocks offered some support.
Market Performance Overview
| Index | Closing Level | % Change |
|---|---|---|
| Nifty 50 | 24,194 | -0.11% |
| Sensex | 80,004 | -0.13% |
| Nifty Midcap 100 | 55,914 | +0.02% |
| Nifty Smallcap 100 | 18,265 | +0.82% |
The broader markets outperformed the benchmarks, with smallcap stocks leading gains, reflecting continued investor interest in select mid and smallcap counters.
Global Factors Weigh on Sentiment
Investor caution dominated the market as President-elect Donald Trump announced fresh tariffs on imports from China, Mexico, and Canada. These measures reignited fears of strained global trade relations. Meanwhile, geopolitical uncertainties in the Middle East and Eastern Europe added to market volatility.
- Reports of progress in a ceasefire between Israel and Hezbollah offered some relief.
- Rising tensions between Russia and Ukraine and Iran’s plans to expand nuclear fuel production, however, kept investors wary.
Sectoral Highlights
Top Gainers
- Nifty IT Index
- Hit a record high of 44,244, driven by a stronger dollar and attractive valuations.
- Key performers: Infosys (+1.5%), Wipro (+1.3%), and TCS (+1.2%).
- Nifty FMCG Index
- Gained 1% amid optimism about rural demand following the Maharashtra election results.
- Leaders: Britannia Industries (+2.3%) and Asian Paints (+1.4%).
- Nifty Realty Index
- Rose 0.6%, continuing its uptrend as political stability in Maharashtra boosted investor confidence.
- Experts attribute gains to strong festive season sales and robust demand in residential real estate.
Top Losers
- Nifty Auto Index
- Declined 1.3%, with heavyweights like Maruti Suzuki (-3.1%) and Tata Motors (-2.8%) dragging the index lower.
- Adani Group Stocks
- Adani Enterprises fell 5.2%, while Adani Ports dropped 3.5%, after Fitch placed Adani bonds on a negative watch amid bribery allegations.
- PSU Stocks
- Witnessed profit-booking; Coal India (-1.2%), ONGC (-1.3%), and Power Grid (-1%) closed in the red.
Market Insights and Key Movers
Domestic Developments
- Maharashtra Assembly Results: The BJP-led NDA’s victory is expected to drive policy continuity, especially in social welfare and infrastructure sectors, benefiting rural and real estate markets.
- Midcap and Smallcap Outperformance: These indices posted modest gains, signaling selective buying after recent corrections. Experts suggest focusing on stock-specific opportunities in this space.
Global Outlook
- US Trade Policies: Tariffs announced by Donald Trump could have far-reaching implications on global trade dynamics, impacting export-dependent sectors in emerging markets like India.
- Geopolitical Risks: Investors remain cautious about the Middle East and Eastern European tensions, which could destabilize global markets.
Expert Views
Ajit Mishra, Senior VP at Religare Broking, noted:
“Nifty’s retest of its 100-day EMA at 24,350 signals resilience, but a decisive close above this level is needed for further upside toward 24,550–24,750. On the downside, 23,850–24,000 is a strong support zone.”
V K Vijayakumar of Geojit Financial Services emphasized the global impact:
“The market’s focus is shifting to geopolitical events and US policy decisions. Positive developments, like the selection of a fiscal conservative as Treasury Secretary, could benefit emerging markets by lowering bond yields.”
Key Stocks to Watch
| Stock | % Change |
|---|---|
| Shriram Finance | +3.4% |
| Britannia Industries | +2.3% |
| Infosys | +1.5% |
| Adani Enterprises | -5.2% |
| Bajaj Auto | -3.2% |
Market Outlook
The market’s short-term trajectory will depend on:
- Clarity on US trade policies and their global ripple effects.
- Developments in geopolitical hotspots like the Middle East and Eastern Europe.
- Domestic macroeconomic indicators, particularly inflation and GDP growth.
Analysts suggest a cautious approach, with opportunities for long-term gains in sectors like IT, FMCG, and real estate.
