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Informist, Thursday, Mar. 6, 2025

By Akshita Kumar

MUMBAI – The benchmark indices are expected to rise Friday due to the fall in the dollar index, the Reserve Bank of India's move to boost liquidity in the banking system, and the decline in crude oil prices. But analysts warned that any negative news about tariffs by the administration of US President Donald Trump may adversely affect the domestic market.

"We are living in very volatile times, as any announcements by Donald Trump may create negativity in the market. It is too early to say that the correction in the market is over," said Amish Shah, research analyst at Shree Stockvision Securities. "After sharp correction in the mid-cap space, investors are finding them (mid-caps) attractive price-wise and even promoters are buying in this space," he said.

Asked about the implications of tariffs on India, Shah said one will have to wait till Apr. 2 for more clarity on the subject. High tariffs may lead to inflation in the US and the US Federal Reserve might hold rates and not cut them, Shah said. He also said there is less chance of the Fed raising its policy rate as this may lead to a slowdown in the US economy.

Foreign portfolio investors will resume buying in the domestic market when domestic corporate earnings start improving from the first half of the financial year starting Apr. 1, Shah said. The impact of the revision in income taxes in the Union Budget will be reflected in Apr-Sept and companies in the consumer dicretionary and fast-moving consumer goods sector are expected to report better earnings as a result, Shah said.

Thursday, the Nifty 50 ended at 22544.70 points, up 207.40 points or 0.9%, and the BSE Sensex ended at 74340.09 points, up 609.86 points or 0.8%. If the Nifty 50 manages to close above the crucial 22600-point level, it could unlock further upside potential towards 23000 points and 23400 points in the near term, Mandar Bhojane, technical and derivative analyst at Choice Broking, said. On the downside, immediate support is seen at 22200 points, which is likely to act as a key demand zone, Bhojane said. Given the recent price action, any dip toward this level will be considered a buying opportunity, as the overall structure suggests a recovery in progress, he said.

The Nifty mid-cap indices ended up 0.3-0.6% and the small-cap indices ended up 1.3-1.5%. The support for the Nifty Midcap 100 index is seen at 46865 points and the resistance is seen at 51555-54535 points for the next few weeks, Jay Vora, market research analyst (technical) at Indiacharts, said. Vora feels that the broader market has bottomed out. He expects the Nifty IT index to underperform as compared to other sectoral indices in the near term due to its weak technical structure. He expects the outperformance of the Nifty Metal index to continue. 

Among specific stocks, shares of Bharat Electronics will be in focus Friday. After market hours Thursday, the company said it had secured additional orders worth INR 5.77 billion. With this, the total accumulated orders received by the company during the current financial year stood at INR 137.24 billion, Bharat Electronics said in an exchange filing. On the data front, the US unemployment insurance weekly claims report will be released later Thursday.  End

Edited by Rajeev Pai

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