Markets continue to deal with losses in early afternoon session

Indian equity markets continued to trade with losses in early afternoon session on the account of Trump's tariffs fears. Investors were looking forward to HSBC Composite PMI and HSBC India Services PMI data, which are due on March 05. Globally investors were worried as U.S. President Donald Trump said reciprocal tariffs would take effect on April 2 on countries that impose duties on U.S. products, stoking fears of a global trade war. He also flagged new U.S. tariffs for imported farm products. Meanwhile, Department for Promotion of Industry and Internal Trade in its latest data has showed that foreign direct investment (FDI) in India dipped by 5.6 per cent year-on-year to $10.9 billion in October-December quarter of this fiscal (2024-25), as compared to FDI inflows of $11.55 billion during October-December 2023-24 due to global economic uncertainties.

On the global front, Asian markets were trading mostly in red after U.S. President Donald Trump confirmed that 25 percent tariffs on goods from Mexico and Canada would come into effect on Tuesday and that he plans 20 percent tariffs on Chinese imports over fentanyl issues.

The BSE Sensex is currently trading at 72948.30, down by 137.64 points or 0.19% after trading in a range of 72633.54 and 73029.84. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index declined 0.04%, while Small cap index was up by 0.97%.

The top gaining sectoral indices on the BSE were PSU up by 1.22%, Capital Goods up by 1.10%, Industrials up by 0.93%, Healthcare up by 0.60% and Bankex was up by 0.45%, while Auto down by 1.03%, FMCG down by 0.93%, Telecom down by 0.72%, TECK down by 0.65% and IT was down by 0.54% were the top losing indices on BSE.

The top gainers on the Sensex were Zomato up by 3.04%, SBI up by 2.84%, TCS up by 0.91%, Power Grid up by 0.57% and ICICI Bank up by 0.39%. On the flip side, Nestle down by 2.48%, Bajaj Finserv down by 2.45%, Titan Company down by 1.85%, HCL Tech down by 1.73% and Hindustan Unilever down by 1.59% were the top losers.

Meanwhile, credit rating agency ICRA’s analysis of 17 leading, listed entities (accounting for around 55% of the total revenues of the industry) operating in the capital goods segment indicates prospects of continued healthy revenue growth of around 13-15% for FY2025 and FY2026. Further, the margins are expected to expand and ICRA expects median operating profit growth of around 16-18% for FY2026, even after witnessing robust growth in the last 3-4 years.

ICRA said the sustained investments in the end-user industries, especially the strong capacity additions in the renewable power space and simultaneously high capex in the transmission and distribution infrastructure bodes well for the demand prospects of the capital goods industry. The order book position of the ICRA sample set companies is at all-time high levels and is growing at a healthy pace with a CAGR of around 19%, amounting to Rs 141,000 crore as on September 30, 2024. Moreover, the budgetary allocation for the government capex has been enhanced to Rs 11.2 lakh crore for FY2026, which, along with planned capacity additions in the cement, steel, oil and gas sectors, is likely to keep the order book position elevated.

It further said power sector, which remains a key end-user industry for the capital goods segment is slated to witness significant capital expenditure estimated at about Rs 25 lakh crore over the next five-year period for capacity addition in renewable & thermal generation, as well as for strengthening of transmission & distribution network, along with storage capacity. Further, capacity expansion plans in the cement sector remain robust with the sector slated to add more than 40 MTPA capacity in FY2026, while data centre capacity is expected to be doubled by FY2027. These, along with refinery capacity expansion and growth in real estate and infrastructure are likely to provide a fillip to the capital goods industry.

The CNX Nifty is currently trading at 22065.30, down by 54.00 points or 0.24% after trading in a range of 21964.60 and 22104.25. There were 18 stocks advancing against 31 stocks declining on the index, while 1 stock remained unchanged. 

The top gainers on Nifty were SBI up by 2.83%, Bharat Electronics up by 2.40%, Trent up by 1.74%, BPCL up by 1.63% and TCS up by 1.04%. On the flip side, Bajaj Auto down by 3.65%, Hero MotoCorp down by 2.74%, Nestle down by 2.47%, Bajaj Finserv down by 2.38% and Titan Company down by 1.75% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 454.29 points or 1.22% to 37,331.18, Taiwan Weighted lost 159.37 points or 0.71% to 22,596.88, Jakarta Composite plunged 99.42 points or 1.52% to 6,420.24, Straits Times fell 11.96 points or 0.31% to 3,896.96, Hang Seng declined 4.61 points or 0.02% to 23,001.66 and KOSPI was down by 3.86 points or 0.15% to 2,528.92. On the flip side, Shanghai Composite was up by 8.5 points or 0.26% to 3,325.43.