India's benchmark indexes, Sensex and Nifty, opened on a cautious note on February 25 after a five-day losing streak, as persistent foreign investor sell-offs and weak global cues continued to weigh on sentiment. However, soon after, the indices rebounded, driven by gains in banking and telecom stocks.
Asian markets mirrored Wall Street’s overnight losses, pressured by renewed concerns over U.S. trade policies. President Donald Trump’s comments that tariffs on Canada and Mexico remain "on time and on schedule," along with his move to curb Chinese investments in strategic sectors, further dampened investor confidence.
At 10 AM, the Sensex edged up 245 points to 74,699, while the Nifty gained 45 points to 22,599. The benchmarks have now declined nearly 14 percent from their record highs in late September and are on track for their fifth consecutive month of losses—the longest losing streak since 1996.
"The dollar index showed resilience gaining strength as U.S. President Donald Trump reaffirmed that tariffs on Mexico and Canada would move forward. This announcement has reignited trade war fears, adding volatility to global markets," said Amit Pabari, MD at CR Forex Advisors.
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"Meanwhile, the ongoing G7 meeting has exposed divisions among member nations, as they struggle to agree on a joint statement addressing the Russia-Ukraine war. With the disagreements over energy sanctions and handling Russia’s aggression have intensified tensions between the U.S. and Europe," he said.
The broader market gained, with the BSE Midcap and BSE Smallcap indices rising 0.3 percent and 0.5 percent, respectively.
Banking and auto stocks provided support to the Nifty 50, while Nifty IT and Nifty Metal indices each slipped 0.3 percent, weighing on overall sentiment.
The IT index declined, extending losses from the previous session, as concerns over slowing U.S. growth weighed on sentiment. With a significant share of revenue coming from the U.S., Indian IT firms faced pressure after U.S. consumer sentiment plunged to a 15-month low in February. Inflation expectations surged amid uncertainty surrounding President Donald Trump’s proposed trade policies.
The IT index also came under pressure following an overnight decline of over 1 percent in the tech-heavy Nasdaq Composite. Large technology stocks were the biggest drag, as investors grew cautious about demand for AI-driven technology while awaiting earnings from market heavyweight Nvidia.
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L&T, Sun Pharma, Hero MotoCorp, Coal India, and Hindalco faced the sharpest declines, falling between 1 and 2.5 percent. On the other hand, Adani Ports, Bajaj Finance, Bharti Airtel, Bajaj Finserv, and M&M emerged as the top gainers, rising 1 to 2 percent.
Tata Investment shares surged 7 percent after Tata Capital’s board approved its initial public offering (IPO).
On a technical basis, Hardik Matalia, Derivative Analyst at Choice Broking said, "The index (Nifty) had been consolidating and attempting to rebound, but the failure to sustain its recovery led to a breakout on the downside."
He sees immediate resistance at 22,650 and 22,800, adding that a decisive close above these levels could trigger an upside move toward 23,000 and 23,250. On the downside, key support levels stand at 22,400 and 22,125.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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