Priyanka Tiwari
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Telecom and auto stocks helped to deficit US tariffs worries, helping Nifty and Sensex maintain their positions during February 25. This came at the cost of the oil and gas sectors and the IT industry, who faced losses. Concerns surrounding Trump's trade policies coupled with his added investment restrictions on China have sped along anxiety surrounding the Canadian markets.
Sensex was at a staggering 74,629 and Nifty at 22,567, making it a decline of 14% from record high in September 2022. Market breadth was mixed with 1,307 out of 2,511 stocks declining on the NSE.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, observed, “The market is oversold, large cap valuations are fair, and short positions in the market are high.” He added, “But the real issue is the relentless FII selling in the cash market.” He went on to add that, “Since cash market selling and shorting in the derivatives market has been profitable, they might continue to sell and try to profit from the negative momentum in the market. It is the sustained buying from DIIs that is preventing the market from capitulation.”
Nifty Metal and Nifty Realty suffered the largest hits, both posting losses of more than one percent. These sectors performed the worst.
The IT index already shed 0.7 percent during the previous day and also showed signs of losses today as fears of a slowing U.S. growth weighed heavily on the sentiment. Indian IT companies felt the heat after US consumer sentiment tumbled to a 15-year low in February. A big chunk of revenues comes from the US. With the utmost uncertainty regarding inflation expectations due to President Donald Trump's trade policy, it was extremely difficult to get an accurate read.
The Index for Information Technology suffered the most losses with large techs blaming fears over a demand for AI-focused tech during the earnings season, waiting for Nvidia’s report. Other large technology companies put significant burden on the stock as the Nasdaq Composite fell more than 1 percent.
Bajaj Finserv, Bajaj Finance, Nestle, Bharti Airtel and M&M take the lead earning 1-3% while Wipro, SBI Life, Coal India, Hindalco and Dr. Reddy’s stand as the biggest losers with a loss of 1-4%.
Tata Capital’s initial public offering plans sparked a seven percent rise in Tata Investment and similarly a near four percent rise in shares of 360 ONE WAM after Citi's revenue prediction. The former is preferred by traders due to acquisition and the lion's share of the payment for II-BAT was done by Citi in recently.
According to Angel One’s head of research (technical and derivatives) Sameet Chavan, “support level at 22500-22400 has become critical for Nifty50 in the immediate future. This range will be important for traders and investors as the ability for defending this range will set the tone on whether the index can bounce back or needs to continue it's downward trend.”
As he put it: “A bearish gap at 22670-22720 looming over attempts at recovery won't help things either. This gap will most likely serve as a price improvement barrier and resilient resistance to the index recovering from its loss.”
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