Markets remain lower with deep cut

Indian equity benchmarks were going through huge selling pressure, with both Sensex and Nifty witnessing a deep cut in late morning session, on the back of negative cues from other Asian markets along with selling at all sectors, as investors shunned risky bets with President Donald Trump ratcheting up tariffs. Traders took a note of reports that the International Monetary Fund retained its classification of India’s ‘de facto’ exchange rate regime as ‘stabilised’ for the period of December 2022 to November 2024 after its latest article IV review. The street overlooked the NCAER monthly review showing that GST collections, gross and net, achieved robust double-digit growth of 12.3 per cent and 10.9 per cent respectively in January 2025, as compared to subdued growth of 7.3 per cent and 3.3 per cent in December 2024.

On the global front, Asian markets were trading lower, after industrial output in Japan dropped a seasonally adjusted 1.1 percent on month in January. That was shy of expectations for a decline of 1.0 percent following the 0.2 percent loss in December. On a yearly basis, industrial production was up 2.6 percent.

The BSE Sensex is currently trading at 73610.44, down by 1001.99 points or 1.34% after trading in a range of 73579.44 and 74282.43. There were 3 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell by 2.39%, while Small cap index was down by 2.71%.

The top losing sectoral indices on the BSE were IT down by 4.05%, TECK down by 3.61%, Auto down by 2.99%, Telecom down by 2.62% and Consumer discretionary down by 2.43%, while there no gaining sectoral indices on the BSE.

The only gainers on the Sensex were Axis Bank up by 1.16%, HDFC Bank up by 1.01% and Reliance Industries up by 0.09%. On the flip side, Tech Mahindra down by 5.49%, Indusind Bank down by 5.21%, Infosys down by 3.88%, Titan down by 3.87% and Maruti Suzuki down by 3.86% were the top losers.

Meanwhile, credit ratings agency ICRA in its latest report has said that passenger vehicle (PV) sales volume in India is expected to grow at a moderate pace of 4-7 per cent in FY26 with most demand drivers remaining neutral or favourable. As for two-wheelers (2W), it estimates the industry volumes to grow at a healthy pace of 6-9 per cent in FY26, following an estimated 11-14 per cent growth in FY25.

According to the report, PV industry volumes reached an all-time high of 4.2 million units in FY24. In year-to-date (YTD) FY25, wholesale volumes remained stable led by steady production by automobile manufacturers but the industry volume growth has been modest at about 2 per cent against the backdrop of waning replacement demand and high inventory levels. Healthy retails have helped moderate dealer inventory holding in the past few months. Nonetheless the inventory continues to be moderately high.

The report said the industry's growth in FY25 is expected at 0-2 per cent. Most of the demand drivers for the industry -- disposable incomes, new model launches, cost of ownership etc -- remain neutral or favourable. Accordingly, even as the base for the industry continues to remain high, ICRA estimates the PV industry volumes to grow at a moderate pace of 4-7 per cent in FY2026. In the two-wheeler (2W) industry, it said volumes witnessed strong growth in the current fiscal at about 10 per cent YoY growth in YTD FY2025, with the industry continuing to recover from lower levels during FY2020-FY2022.

It said the industry prospects over the past few months have remained supported by improved rural demand post a healthy monsoon precipitation. Rural demand for the industry is expected to remain healthy, with rabi sowing till date remaining healthy. A reduction in income-tax outgo post changes in tax slabs in the Union Budget is likely to support an increase in disposable income and support demand. Factors like improvement in economic activities, continued budgetary support towards infrastructure spend, healthy freight availability further supporting freight rates, and regulations such as scrappage policy and push towards cleaner vehicles could drive replacement demand.

The CNX Nifty is currently trading at 22240.40, down by 304.65 points or 1.35% after trading in a range of 22224.10 and 22450.35. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Coal India up by 2.50%, Axis Bank up by 1.12%, HDFC Bank up by 0.96%, Shriram Finance up by 0.51% and Grasim Industries up by 0.33%. On the flip side, Tech Mahindra down by 5.47%, Indusind Bank down by 5.16%, Wipro down by 4.52%, Titan down by 3.94% and Maruti Suzuki down by 3.87% were the top losers.

All Asian markets were trading lower; Hang Seng declined 658.21 points or 2.78% to 23,060.08, Jakarta Composite plunged 185.31 points or 2.94% to 6,300.14, Shanghai Composite weakened 45.77 points or 1.35% to 3,342.29, Straits Times fell 28.86 points or 0.74% to 3,892.33, KOSPI dropped 86.52 points or 3.3% to 2,535.23 and Nikkei 225 slipped 1071.65 points or 2.8% to 37,184.52.