Indian benchmark stock market indices ended Thursday’s trading session on a weak note, primarily due to a sell-off in heavyweight financial stocks and cautious investor sentiment amid global uncertainties. The S&P BSE Sensex declined by 203.22 points, or 0.27%, to close at 75,735.96, while the NSE Nifty50 slipped 19.75 points, or 0.09%, settling at 22,913.15. Despite the subdued performance of the frontline indices, broader market indices showed signs of resilience, providing some relief to investors. The BSE Midcap and Smallcap indices continued their recovery, suggesting that some buying interest remained in the broader market segments. Additionally, volatility in the market, as measured by the India VIX, declined sharply during the session, indicating some stability in trading sentiment.
Among the key drags on the market were heavyweight stocks such as Maruti Suzuki and HDFC Bank, both of which lost over 2% during the trading session. Other notable losers included Tech Mahindra, HCLTech, and ITC, which saw declines as well, contributing to the overall weakness in the indices. On the other hand, some stocks supported the market, with NTPC, M&M, Adani Ports, Tata Steel, and Tata Motors emerging as the top gainers of the day, helping offset some of the losses.
The decline in market sentiment was attributed to a combination of global and domestic factors. Vinod Nair, Head of Research at Geojit Financial Services, highlighted that concerns over potential US tariffs on Indian goods led to capital outflows, dampening investor confidence. The proposed trade policy, he explained, is expected to exert inflationary pressures, while the latest Federal Reserve minutes signaled that an interest rate cut in the US may be delayed further, leading to heightened uncertainty in global financial markets.
Prashanth Tapse, Senior Vice President (Research) at Mehta Equities Ltd, echoed similar concerns, stating that weak Asian market cues kept investors cautious throughout the session. He noted that Foreign Institutional Investors (FIIs) have been offloading Indian equities in significant quantities over the past few months, leading to increased nervousness in the domestic market. The continuous outflow of foreign capital has made investors jittery, pushing them towards a more risk-averse approach, he added.
The broader market sentiment was also influenced by ongoing concerns about global economic conditions, including geopolitical tensions, supply chain disruptions, and fluctuating commodity prices. Investors are now closely monitoring key economic indicators, corporate earnings reports, and policy decisions that could shape market trends in the coming weeks.
As the trading session concluded, analysts suggested that the market may remain volatile in the near term, with investors keeping a close eye on global developments, including Federal Reserve policy decisions, trade negotiations, and corporate earnings data. While broader market indices have shown some resilience, the overall direction of the market will largely depend on how domestic and global macroeconomic factors evolve in the coming days.
