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Informist, Thursday, Mar. 13, 2025

By Akshita Kumar

MUMBAI – Benchmark indices are expected to fall further Monday due to the risk of US tariffs affecting global economic growth and continued selling by foreign portfolio investors. Any news about imposition of tariffs by US President Donald Trump on India could affect the market adversely, analysts said. The Indian stock market is closed Friday on account of Holi and will reopen on Monday.

"The moderating inflation and uptick in GDP numbers failed to cheer investors, as markets ended weak in late selling pressure with mixed European and Asian cues coupled with FII selling dominating the mood," Prashanth Tapse, senior vice president (research) at Mehta Equities, said in a note. Investors are nervous about the likely imposition of tariffs on Indian goods by the Trump administration and its overall impact going ahead, hence caution with a negative bias could prevail for some more time, Tapse said in the note.

"The market sentiment has become very pessimistic right now and no one wants to buy anything," Amish Shah, research analyst at Shree Stockvision Securities, said. Further, data from Association of Mutual Funds in India Wednesday showed that equity fund inflows dropped 26% to INR 293.03 billion in February due to market volatility. The data shows that people are not keen to buy, Shah said.

Shah expects volatility in the domestic market to continue at least till Apr. 2 when the reciprocal tariffs will kick in. Foreign institutional investors are finding other emerging markets such as China and Hong Kong attractive as valuations seem to be cheaper over there as compared to India, he said. FIIs will come back to the domestic market when the valuation froth in the mid- and small-cap space comes off and corporate earnings improve, Shah said.

On Thursday, the Nifty 50 ended at 22397.20 points, down 73.30 points and 0.3%, and the BSE Sensex ended at 73828.91 points, down 200.85 points or 0.3%. The first support for the 50-stock index is seen at 22250 points and next support is seen at 22100 points for the next week, Ashish Sherigar, technical analyst at NVS Brokerage, said. Sherigar has pegged the resistance at 22600 points and 22800 points.

The Nifty Midcap indices ended down 0.6-0.8% and the small-cap indices ended down 0.7-1.1%. For the next week, support for the Nifty Midcap 50 is seen at 13480-13400 points and resistance at 14000-14100 points, Vipin Kumar, assistant vice-president technical and derivatives research at Globe Capital Market, said. Support for the Nifty Smallcap 100 is seen at 14450-14300 points and resistance at 15400-15600 points, Kumar said.

Kumar is bearish on the Nifty IT index in the short-term and expects it to test the 35000-point levels in the near-term. Medium-term and long-term investors can accumulate large cap information technology stocks on dips, Kumar said.

On the data front, the commerce ministry will release India's wholesale inflation data for February at 1200 IST on Monday. A poll by Informist expects WPI inflation to rise marginally to 2.4% from 2.31% in January.  End

Edited by Ashish Shirke

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