In a surprising twist, benchmark indices Nifty and Sensex rebounded from early losses to trade firmly in the green. However, the recovery was short-lived, as a sharp sell-off in both public and private sector banks, along with metal stocks, dragged the indices back into the red. The only silver lining came from FMCG stocks, which managed modest gains. Meanwhile, the small and midcap indices bore the brunt of the market downturn, sliding even deeper than their larger counterparts.
At 12:3o pm, the Sensex was down 820.45 points or 1.06 percent at 76,252.99, and the Nifty was down 210.55 points or 0.90 percent at 23,134.20. About 1,168 shares advanced, 2,250 shares declined, and 119 shares unchanged.
Follow our LIVE blog for all the latest market updates
V K Vijaykumar, Chief Investment Strategist at Geojit Financial Services said that Trump's second term has begun with ambiguity around his economic policies, offering clarity on immigration but remaining vague on tariffs.
A proposed 25 percent tariff on Canada and Mexico hints at a gradual implementation of trade measures. Markets reacted with a dip in the dollar index to 108.43 and a decline in the 10-year bond yield to 4.54 percent. Delays in tariff hikes could further weaken the dollar and lower bond yields, benefiting emerging markets like India. However, consistent FII inflows to India hinge on a recovery in GDP growth and corporate earnings, which remain critical to watch.
In the broader market, mid and small-cap mirrored the overall weak trend with losses of nearly 2 percent each. Ajit Mishra of Religare Broking said that valuations in mid-cap and small-cap stocks remain stretched above long-term averages, suggesting room for further decline. Investors should adopt a stock-specific approach, focusing on strong businesses rather than expecting broad-based participation.
Also read: India VIX, the fear index, hits six month high as experts caution over near-term nervousness
Nifty Bank and PSU Bank index were the major laggards, falling over a percent each. Nifty Metal followed suit, down 1 percent in the afternoon. Nifty Realty plunged the most, down by 2 percent, led by DLF, Oberoi Realty and Pheonix. Auto, Energy and consumer durables traded lower by almost a percent each.
EMS major Dixon Technologies (India) hit a 10 percent lower circuit at Rs 15,804 after the company reported a sequential decline in its consolidated net profit and revenue from operations for the quarter ending December. In Q3FY25, Dixon's net profit dropped 47.5 percent year-on-year to Rs 216 crore from Rs 411.7 crore in Q3FY24. Revenue for the quarter declined by over 9 percent to Rs 10,453.7 crore.
Shares of Sunteck Realty skyrocketed over 10 percent on January 21, buoyed by the company's solid earnings performance in the December quarter. The real estate major jumped back into the black with a net profit of Rs 42.50 crore, a massive turnaround from a loss of Rs 9.70 crore in the year-ago period. The surge in net profit was also coupled with an over 2.5x jump in revenue to Rs 161.80 crore, up from Rs 42.40 crore in the same quarter last fiscal.
Read more: Donald Trump threatens 100% tariffs against India, other BRICS nations but...
Zomato shares plunged 12 percent after it reported a 57 percent year-on-year (YoY) decline in quarterly profit after tax at Rs 59 crore in the third quarter. The company has hopped on an aggressive store expansion spree for its quick commerce business, Blinkit. This expansion has driven up investment costs, inflating Blinkit's losses and squeezing Zomato's net profit in Q3. Despite the stock taking a hit after Zomato's weak Q3 numbers, optimism among brokerages seems to remain unhinged.
"The bulls face persistent resistance, with hurdles at regular intervals. In the immediate term, 23,400 serves as a key resistance. A breakout above this could pave the way for an extension of the rally towards 23,700–23,750. That said, a decisive shift in the broader trend would require prices to surpass all major moving averages and breach the descending trendline resistance near 24,000," Sameet Chavan, Head of Technical and Derivative Research at Angel One said.
"On the downside, the intraday low around 23,150 serves as immediate support, followed by stronger support in the 23,000–22,900 zone, aligned with a falling wedge pattern. Traders should monitor these key levels and align their strategies accordingly during what promises to be an eventful week," he added.
Apollo Hospitals, BPCL, UltraTech Cement, Tata Consumer Products and Asian Paints on the Nifty. Trent, Adani Ports, M&M, SBI and NTPC were the major laggards on the index.
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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
