Sensex, Nifty jitter as profit booking kicks in amid weak global cues; financials, IT stocks drag

Indices snapped a two-day winning streak at open today.

Indian benchmark indices turned jittery on March 7 after two consecutive day of gains, mirroring losses across global markets. The Nifty and Sensex opened with minor cuts, weighed down by profit booking in heavyweight sectors like financials and information technology.  However, continued buying in index heavyweight Reliance Industries offered some support, helping the headline indices eke out marginal gains.

At 11.29 am, the Sensex was up 147.98 points or 0.20 percent at 74,488.07, and the Nifty was up 58.20 points or 0.26 percent at 22,602.90. About 2,613 shares advanced, 804 declined, and 122 were unchanged.

Global markets were back to losing ways, with the US-based Nasdaq Composite slipping into correction territory overnight. The other two major US benchmarks--the Dow Jones Industrial Average and S&P 500 also ended in the red. Asian markets followed the trend and slumped in trade today, with Japan's Nikkei 225 being the worst hit.

Global financial markets have been on a turbulent ride as Trump’s tariff policies have raised concerns among investors about the future of US economic growth. On Thursday, Trump announced that a range of goods from Canada and Mexico, covered under the USMCA trade agreement, would be exempt from the new duties until April 2. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services highlighted a layer of uncertainty seen across global markets amid a lack of clarity over Trump's tariff plans.

"Trump dilly dallying on tariffs with the latest decision to postpone imposition of tariffs on Canada and Mexico to April 2nd is being viewed by markets seriously. Markets feel that Trump is keen to negotiate deals rather than stick to high tariffs for the long term. This is acknowledgement of the fact that high tariffs for long term will impact the US economy, too. The sell-off in the US stock markets also is an indication that Trump’s policies might impact growth and earnings in the US," Vijayakumar said.

Howard Marks, Co-Chairman of Oaktree Capital also echoed similar views at Moneycontrol's Global Wealth Summit 2025, taking place in Mumbai today. "Donald Trump will try very hard to make business do well, to make American businesses do well. However, some of his actions will have short-term negative effects. His tariffs could have an inflationary impact as his policies are taken to their logical extreme and we don't know how far he will take it," Marks said.

Meanwhile, investors also exhibited some risk aversion ahead of the release of the US nonfarm payrolls data, due on Friday, in attempts to gauge the condition of the US labour market.

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On the technical front, Devarsh Vakil, Head of Prime Research at HDFC Securities anticipates volatility to make its presence feel today. He sees the next resistance zone for the Nifty to be around 22,720-22,725, where the 21-day exponential moving average and previous swing low converge is place. However, he added that support for the index has moved higher to 22,300 following its two-day gains.

"Traders should prepare for larger swings across different asset classes during what might be a period of significant market shifts. Indian markets are poised to open lower on Trump’s tariffs, fuelling uncertainties," Vakil added.

Despite volatility for the headline indices, the broader market saw continued buying, leading to the overall positive market breadth. The BSE Smallcap index surged 0.7 percent while the BSE Midcap was up 0.3 percent, faring better than their large-cap counterparts.

On the sectoral front, of the 13 major sectoral indices, Nifty IT, Nifty FMCG, Nifty Bank and Nifty Energy emerged as the top laggards, down 0.3-0.5 percent, as investors jumped to take home profits after strong gains in the last session.

On the flipside, the Nifty Metal index continued its uptrend for the fifth session, gaining another 1 percent alongwith Nifty Media, which posted similar gains. Nifty Auto and Nifty Pharma indices also glimmered in the green.

Among Nifty 50 constituents, Reliance Industries, HDFC Life, Bharat Electronics and Hero MotoCorp were the biggest gainers, rising 1-2 percent. On the other hand, IndusInd Bank, Shriram Finance, Infosys, BPCL and NTPC were the worst hit, down 1-3 percent.

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