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Informist, Monday, Feb. 10, 2025

By Akash Mandal

MUMBAI – Benchmark indices ended lower Monday as sentiment dampened due to uncertainty regarding US President Donald Trump's threats of imposing a 25% import tariff on all steel and aluminium from Monday. Following Trump's statement, German Chancellor Olaf Scholz said Europe was prepared to retaliate "within an hour" if the US president goes ahead with his threat, sparking concerns of a global tariff war which could lead to uncertainty for markets around the world. The benchmark indices have now extended their losing streak for fourth straight session.

The Nifty 50 ended at 23381.60 points, down 178.35 points or 0.8%, and the BSE Sensex closed at 77311.80 points, down 548.39 points or 0.7%. The negative sentiment was evident in the negative market breadth, with over 78% of the stocks listed on the National Stock Exchange and over 76% of the stocks listed on the BSE ending in the red. However, headline indices closed off their lows of the day after falling as much as 1% during the session. Broader market indices ended sharply down, with the Nifty Smallcap and Nifty Midcap indices declining over 2%. 

A weak rupee also weighed on the equity market. The rupee hit a record low of of 87.95 against the dollar in early trade but recovered most of its declines due to likely intervention by the Reserve Bank of India. The currency ended at 87.4750 against the dollar. A weaker rupee hurts the returns of foreign institutional investors, and  falling currency would potentially trigger further outflows.

All sectoral indices ended in the red, with the Nifty Metal and the Nifty Realty falling around 3% each. Metal stocks were weighed down by the potential tariff threats by the US. However, dometic metal companies will not be significantly affected due to the potential tariffs as their steel exports to the US are not significant. Tata Steel and JSW Steel ended down 3% and 2%, respectively. National Aluminium Co., Steel Authority of India, and Vedanta all slumped over 4%. 

Among the Nifty 50 constituents, Trent ended nearly 5% lower at INR 5,196.75 and was the worst hit in the index. The stock has fallen nearly 10% since reporting underwhelming earnings for the December quarter during market hours Thursday. The fall is a sharp correction following a prolonged rally during the latter half of 2024, an analyst at a leading domestic brokerage said. "The stock had reached a 52-week high of more than 8,000 bucks (INR 8,000) despite not much changing fundamentally. Thus, the fall is a natural correction," the analyst said. The stock has fallen nearly 38% from its 52-week high of INR 8,345 it reached on Oct 14. On the other hand, Kotak Mahindra Bank ended 1.6% higher and was the only stock with significant gains on the index.

The Nifty FMCG had risen a bit in early trade but slipped into the red due to the overall weak sentiment in the market. The index is currently on a six session losing streak, during which it has fallen over 6%. Britannia Industries, which was up over 2% earlier in the session, ended nearly 1% higher. ITC, Colgate-Palmolive (India), and Godrej Consumer Products all ended around 1% lower. 

Among other stocks, Alkem Laboratories fell 7% after the company said in its post earnings conference call Friday that the March quarter would be seasonally weak due to higher expenses towards research and development. Delhivery closed almost 6% lower after its consolidated net profit of INR 249.88 million for the December quarter missed analysts' estimates of INR 686 million. Oil India fell around 5% after the company reported weaker-than-expected earnings for the December quarter. Its net profit and revenue for Oct-Dec fell more than analysts' expectations due to a decline in sales of crude oil and natural gas. Netweb Technologies India, JM Financial, and Ujjivan Small Finance Bank all fell 7-8% and were among the worst hit in the Nifty 500. 

Bajaj Holdings & Investment gained a tad over 2% and ended as the top performer in the Nifty 200. Signatureglobal (India) rose 5% and was the top gainer in the Nifty 500. Earlier in the day, Axis Securities initiated coverage on the stock with a 'buy' rating and a target price of INR 1,645. Engineers India ended up over 3% after its net profit for the December quarter surged 75.4% on year to INR 881.04 million. 

* Of the Nifty 50 stocks, 10 rose, 39 fell, and 1 unchanged

* Of the Sensex stocks, 6 rose and 24 fell

* On the NSE, 627 stocks rose, 2,257 fell, and 71 were unchanged

* On the BSE, 1,070 stocks rose, 3,032 fell, and 123 were unchanged

* Nifty Realty: down 3%; Nifty Metal: down 2.6%; Nifty Private Bank: down 0.2%

BSE                                                      NSE

77311.80 points, down 548.39 points or 0.7%              23381.60 points, down 178.35 points or 0.8%

End

US$1 = INR 87.47

Edited by Saji George Titus

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