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Informist, Thursday, Feb. 26, 2026

 

By Eshitva Prakash

MUMBAI – The benchmark equity indices are expected to remain in a range Friday with investors likely to continue selling on a rise, according to technical analysts. Investors worry that an attempt to renegotiate US import tariffs may result in a worse situation for India, analysts said.

 

After US President Donald Trump reacted to the country's Supreme Court striking down most of his emergency reciprocal tariffs Friday by imposing a 10% blanket tariff on all imports effective Tuesday, analysts fear he will find a way to raise them to 15%, something he has already threatened, or even more. The negotiations between Iran and the US will also be keenly watched. Failure of the talks is likely to have a sharp impact on global equity markets.

 

"I think the current fear (among investors) is that these tariff fluctuations will result in a (US) import tariff (on India) which is higher than on other Southeast Asian countries," Rohit Srivastava, market strategist and founder at Indiacharts, said. After India deferred the visit to the US of the team that was to negotiate the trade deal, it is unclear whether New Delhi will continue its commitment to the India-US framework agreement under which the country faced 18% import tariffs.

 

Trump has warned countries against "playing games" with previously signed deals and said such countries will face harsher measures. "This tariff uncertainty will keep markets under pressure for quite some time, but if the government was to issue a statement on our policy going forward, it would really help investors place educated bets," Srivastava said. The analyst said that while a tariff overhang will continue to weigh on the equity markets, reverberations of the uncertainty are also being felt on the rupee.

 

Depreciation of the rupee is likely to deter foreign investors from participating in the domestic equity markets. "While some analysts have taken a short-term view on foreign investor participation and arrived at a conclusion that foreign investors are returning, I look at these things with a larger time-frame in mind," Srivastava said. He believes the high long-term capital gains tax is one of the key roadblocks to foreign participation in domestic equity markets.

 

The third round of indirect nuclear talks in Geneva, Switzerland, between the US and Iran began Thursday and will be in analysts' sights. The mediator country, Oman, said the two sides have expressed openness "to new and creative ideas and solutions", according to media reports. The discussions are taking place amid a massive US military build-up in the Persian Gulf. "If a war between Iran and the US were to happen, it will shoot up global crude prices and affect liquidity and risk appetite of investors across the world," Srivastava said. The analyst believes escalation of the disagreement would result in a medium-term disruption in the US market, and thereby equity markets across the world.

 

Shares of defence companies will be in focus. India is likely to formalise defence agreements worth $8.6 billion with Israel, including full technology transfer of the Iron Dome and Iron Beam systems, a strategic milestone that could materially strengthen India's domestic defence manufacturing ecosystem, Siddhartha Khemka, head of research, wealth management, Motilal Oswal Financial Services, said in a note. 

 

The headline indices have been under pressure recently from the turmoil in information technology stocks. Some analysts expect that a slew of partnership announcements with artificial intelligence companies will help to allay some of the worries relating to the increasing use of AI tools. However, technical analysts expect domestic IT companies to consolidate rather than surge in the near term, following a sharp decline in the past couple of weeks.

 

"The Nifty 50 will likely spend some time in consolidation," Vipin Kumaar, derivatives and technical analyst at Globe Capital Market, said. Kumaar expects the 50-stock index to find support at 25300 points and face resistance at 25650 points. "Investors' approach will be to sell on rise," the analyst said. Thursday, the Nifty 50 ended at 25496.55 points, up just 14.05 points, practically flat compared to Wednesday's close. The BSE Sensex ended at 82248.61 points, down 27.46 points.  End

 

Edited by Rajeev Pai

 

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