The last trading session of FY25 ended on a weak note for Dalal Street, as both Sensex and Nifty closed in the red on Friday, primarily dragged down by IT and auto stocks. Investor sentiment remained cautious due to growing concerns over new US tariffs, which led to a broader selloff in global markets. Additionally, rising inflation data from Japan further dampened market sentiment, leading to uncertainty among investors. The S&P BSE Sensex fell by 191.51 points (0.25%), settling at 77,414.92, while the NSE Nifty50 declined by 72.60 points (0.31%) to close at 23,519.35.
Factors Driving the Market Decline
According to Vinod Nair, Head of Research at Geojit Financial Services, Asian markets are currently in a consolidation phase as the latest US trade measures are expected to impact major manufacturing economies, particularly those in Asia. The newly announced reciprocal tariffs by the US are likely to increase costs for various industries, including the auto sector, electronics, and pharmaceuticals, which depend heavily on exports and global supply chains.
Adding to the negative sentiment, Japan's Consumer Price Index (CPI) data showed a rise, indicating persistent inflationary pressures in the region. This development has raised concerns that central banks might be forced to continue their tight monetary policies, which could impact economic growth.
On the domestic front, market momentum has slowed down as investors assess the potential impact of these tariffs on key sectors such as automobiles, ancillary industries, pharmaceuticals, and technology. Meanwhile, gold prices surged to a new all-time high, reflecting increasing investor concerns that a prolonged trade war could severely disrupt global economic stability.
The sharp decline in IT and auto stocks was directly linked to concerns over US tariffs, which are set to take effect on April 2, 2025. The new measures could lead to higher operational costs for companies that rely on the US market, impacting their revenue and profitability.
Market Performance Overview
Despite the overall weakness, select stocks showed resilience, with banking and FMCG sectors providing some support. Kotak Bank and ICICI Bank emerged as top gainers, benefiting from steady institutional buying. However, IndusInd Bank, M&M, and Infosys were among the biggest losers, struggling due to sector-specific challenges.
Top Gainers and Losers on BSE
Gainers:
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Kotak Bank: Gained 1.88%, leading the list of gainers as strong fundamentals and stable growth prospects attracted investors.
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Hindustan Unilever (HUL): Rose 1.01%, showing resilience in a volatile session as FMCG stocks remained relatively strong.
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ICICI Bank: Increased by 0.87%, continuing its steady momentum amid institutional buying.
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Tata Motors: Moved up 0.82%, benefiting from buying interest despite concerns over tariffs.
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Nestle India: Added 0.75%, contributing to overall market stability.
Losers:
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IndusInd Bank: Dropped 3.57%, making it the worst performer of the session due to weak quarterly expectations.
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M&M (Mahindra & Mahindra): Declined 2.45%, facing heavy selling pressure as auto stocks struggled.
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HCLTech: Fell by 2.20%, as IT stocks suffered due to concerns over global demand.
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Maruti Suzuki: Lost 2.10%, impacted by fears that US tariffs could hurt exports.
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Infosys: Dropped 2.07%, struggling alongside other IT companies as global recession fears lingered.
Top Gainers and Losers on NSE
Gainers:
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Tata Consumer Products Limited: Gained 2.91%, emerging as the top performer on NSE due to strong fundamentals.
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Kotak Bank: Rose 2.13%, reflecting positive sentiment as banking stocks outperformed.
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Apollo Hospitals: Climbed 1.88%, showing resilience as healthcare stocks remained stable.
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ONGC: Increased by 1.79%, supported by strong crude oil prices and positive demand outlook.
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ICICI Bank: Moved up 0.85%, continuing its upward trajectory amid strong quarterly performance.
Losers:
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IndusInd Bank: Fell by 3.64%, making it the worst-performing stock of the session.
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Wipro: Dropped 3.56%, extending losses in the IT sector as weak global cues impacted sentiment.
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Shriram Finance: Declined 3.28%, struggling under selling pressure as concerns over lending growth intensified.
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Cipla: Lost 2.83%, underperforming in the pharma sector despite overall stability in healthcare stocks.
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M&M: Dropped 2.63%, continuing its downward trend due to tariff concerns.
Market Outlook and Key Takeaways
Looking ahead, market participants will be closely monitoring global trade developments, particularly how the US tariffs impact different industries. Analysts expect volatility to persist in the coming weeks, with sectoral rotation playing a key role in determining overall market trends.
Investors are also expected to focus on key macroeconomic indicators, including inflation data, interest rate policies, and corporate earnings, to gauge the market’s future direction. Experts advise a cautious approach, with an emphasis on defensive sectors such as FMCG, healthcare, and banking, which have shown relative strength in volatile conditions.
Additionally, crude oil prices, global interest rate trends, and geopolitical developments will play a significant role in shaping market sentiment in the upcoming sessions.
