Benchmark stock market indices opened on a cautious yet slightly positive note on Wednesday, with the S&P BSE Sensex rising 51.83 points to 78,069.02 by 9:22 am, while the NSE Nifty50 climbed 49 points to 23,717.65. This performance comes as investors remain on edge, awaiting further clarity on the potential economic repercussions of the US reciprocal tariffs, which are set to take effect on April 2, 2025. The uncertainty surrounding these tariffs has kept market participants wary, though early trading movements suggest a degree of resilience in the face of looming policy shifts.
All broad market indices opened in the green, though volatility on Dalal Street appears to be on the rise as the tariff deadline nears. Analysts believe this uptick in volatility reflects market participants repositioning their portfolios to hedge against potential losses while staying open to new opportunities. Despite this, the fact that the main indices haven’t experienced a sharp dip is being viewed as a positive signal — one that indicates the market may have already priced in the possible fallout from Donald Trump's proposed tariff measures. This sentiment is bolstered by the steady performance of blue-chip stocks, suggesting that seasoned investors are holding their ground.
Among Nifty sectoral indices, the real estate sector emerged as the standout performer, rising nearly 2% amid renewed interest in infrastructure and housing-related stocks. Market experts attribute this uptick to growing optimism around domestic demand and potential government incentives aimed at boosting the sector. Other sectors logged modest increases, with financial services, energy, and consumer goods showing strength.
The top gainers on the Nifty50 included IndusInd Bank, Bharti Airtel, PowerGrid, BPCL, and Bajaj Finserv, all of which posted notable gains in early trading. IndusInd Bank, in particular, surged after reports indicated the private lender is preparing to initiate a formal search for new top executives, including a replacement for its current CEO. Meanwhile, Bharti Airtel’s rise was driven by positive sentiment surrounding its expanding 5G network rollout and improving revenue forecasts.
Conversely, stocks facing downward pressure included Dr Reddy's, NTPC, Asian Paints, Maruti, and Titan. Analysts suggest that weakness in the pharmaceutical sector, particularly for Dr Reddy’s, may be tied to concerns about potential pricing pressures in the US market — a key revenue source for Indian drugmakers. NTPC and Maruti’s declines were attributed to profit booking after recent gains, while Titan saw a dip as luxury goods stocks faced headwinds from cautious consumer spending trends.
Market analysts note that the past seven consecutive sessions of gains indicate that the worst may be over for Dalal Street, even if short-term volatility persists. Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, emphasized that the market’s resilience, despite the looming tariff deadline, signals the potential for further upside — especially if the final tariff measures turn out to be less severe than initially feared.
He also mentioned the possibility of a bilateral agreement between the US and India, highlighting that ongoing diplomatic negotiations could yield a more favorable outcome for both economies. Vijayakumar pointed to strong macroeconomic fundamentals — including India’s growing industrial output, robust services sector, and improving current account deficit — as key factors supporting the market’s underlying strength.
"In the last four trading days alone, foreign institutional investors (FIIs) have made net purchases worth Rs 19,136 crore, indicating that this positive trend may continue," Vijayakumar explained. He added that high-quality financial stocks with fair valuations are likely to remain resilient, and if the tariff measures are softened or delayed, pharmaceutical stocks could stage a strong rebound.
Looking ahead, analysts advise investors to focus on fundamentally sound, fairly valued stocks to weather the ongoing uncertainty. Sectors like technology, energy, and consumer goods — particularly those with strong domestic demand drivers — are expected to hold steady. Meanwhile, defensive sectors like healthcare and utilities could see renewed interest if global uncertainties deepen.
While volatility may remain elevated in the short term, the overall sentiment points to cautious optimism. Many market watchers believe that if the US-India trade talks yield a constructive outcome, the Indian stock market could be poised for a significant rally, driven by renewed foreign investment and stronger economic growth prospects.
