Sensex, Nifty reel under selling pressure

Indian equity markets were witnessing selling pressure in late morning deals, with Sensex and Nifty falling over half a percent each, despite positive cues from other Asian markets. Heavy selling at Energy and Oil & Gas counters hit the sentiments most. Traders also got cautious, as India's manufacturing activity grew at slow pace in the month of February. Despite slowing to the weakest since December 2023, rates of expansion in output and sales remained elevated in the context of the survey's 20-year history. According to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) eased to 56.3 in February as against 57.7 in January.

On the global front, Asian markets were trading mostly in green, after China's manufacturing activity logged a faster growth in February underpinned by rises in both output and new orders. The survey data published by S&P Global showed that the Caixin manufacturing Purchasing Managers' Index rose to 50.8 from 50.1 in the previous month. The reading was seen at 50.4. The index has remained above the threshold 50.0 mark for the fifth straight month suggesting expansion. 

The BSE Sensex is currently trading at 72800.80, down by 397.30 points or 0.54% after trading in a range of 72784.54 and 73649.72. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell by 1.79%, while Small cap index was down by 2.73%.

The only gaining sectoral indices on the BSE were TECK up by 0.50% and IT up by 0.23%, while Energy down by 2.47%, Oil & Gas down by 1.84%, Industrials down by 1.71%, Metal down by 1.61% and PSU down by 1.34% were the top losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 2.52%, Infosys up by 1.49%, Bharti Airtel up by 1.25%, Mahindra & Mahindra up by 0.82% and ITC up by 0.63%. On the flip side, Reliance Industries down by 3.16%, Indusind Bank down by 2.93%, Zomato down by 2.75%, Bajaj Finserv down by 2.56% and Adani Ports & SEZ down by 2.15% were the top losers.

Meanwhile, the Chairman of the 16th Finance Commission, Arvind Panagariya has said that looming threat of reciprocal tariffs from the US could be turned into a positive if India can leverage it to secure mutual tariff reductions. However, he cautioned that if it results in a tariff war, where the US imposes tariffs on India and New Delhi retaliates with its own tariffs, it would have an 'unfortunate' outcome. US President Donald Trump on multiple times said that America will impose reciprocal tariffs against India and alleged that India is a 'tariff king' and 'tariff abuser'. US’ 25 per cent tariff on steel and aluminium will be in effect from March 12.

While talking about India’s competitive advantage and access to US markets he said that the country has a very good opportunity to do a win-win bargain on reciprocal tariffs, as India’s economic liberalization makes it more competitive and through reciprocal tariff bargain Indian sectors such as textile and clothing can get better access to US markets. However, he warned that if the both sides end up in a kind of tariff war in which the US impose tariffs on India and India retaliates with imposing tariffs on US will not be advantageous for either side.

In Prime Minister Narendra Modi’s recent visit to Washington, India and the US announced their commitment to more than double the two-way commerce to $500 billion by 2030 and negotiate the first tranche of a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA) by fall of 2025. During 2023-24, the US was the largest trading partner of India with $119.71 billion in bilateral trade in good ($77.51 billion worth of exports, $42.19 billion of imports, with $35.31 billion trade surplus).

The CNX Nifty is currently trading at 22011.95, down by 112.75 points or 0.51% after trading in a range of 22005.70 and 22261.55. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 2.20%, Grasim Industries up by 2.07%, Eicher Motors up by 1.94%, Wipro up by 1.80% and Infosys up by 1.52%. On the flip side, Coal India down by 4.21%, Reliance Industries down by 3.27%, Indusind Bank down by 3.21%, Bajaj Finserv down by 2.60% and Adani Enterprises down by 2.39% were the top losers. 

Asian markets were trading mostly in green; Hang Seng advanced 294.96 points or 1.29% to 23,236.28, Jakarta Composite gained 236.1 points or 3.63% to 6,506.70, Shanghai Composite strengthened 12.26 points or 0.37% to 3,333.16, Straits Times rose 17.82 points or 0.46% to 3,913.52 and Nikkei 225 surged 630.81 points or 1.7% to 37,786.31, while Taiwan Weighted lost 388.87 points or 1.69% to 22,664.31.