Markets trade lower in early deals amid weak global cues

Indian equity benchmarks made flat-to-positive start on Friday, amid foreign fund inflows. According to exchange data, Foreign Institutional Investors (FIIs) purchased equities worth Rs 11,111.25 crore on Thursday. Soon, markets turned volatile and slipped below neutral lines in early deals amid weak global cues. The uncertainty about US President Donald Trump's trade policies continues to weigh on market sentiment. Some cautiousness crept in as the finance ministry said the Centre plans to raise Rs 8 lakh crore through dated securities during April-September period of 2025-26 to fund the revenue gap.

Global cues remained weak with Asian markets trading mostly lower, following the broadly negative from Wall Street overnight, amid concerns over upcoming reciprocal tariffs and the 25% tariffs on auto and auto components imports in to the U.S. to go in to effect next week. Back home, Media and entertainment industry stocks are in focus as report by FICCI and EY indicated that India’s media and entertainment industry generated approximately Rs 2.5 trillion in revenue in 2024, expanding at a relatively modest 3.3 per cent year-on-year, even as it underwent a rapid transformation. In stock specific development, BSE shares surged after market regulator Securities and Exchange Board of India (SEBI), in its consultation paper on Thursday evening, proposed to keep all equity derivative contracts expiry either on Tuesday or Thursday.

The BSE Sensex is currently trading at 77352.92, down by 253.51 points or 0.33% after trading in a range of 77309.79 and 77750.45. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.28%, while Small cap index was up by 0.65%.

The top gaining sectoral indices on the BSE were FMCG up by 1.51%, Oil & Gas up by 1.03%, PSU up by 0.62%, Energy up by 0.58% and Industrials up by 0.51%, while IT down by 0.99%, TECK down by 0.88%, Auto down by 0.86%, Healthcare down by 0.40% and Bankex down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Nestle up by 1.92%, Hindustan Unilever up by 1.63%, ITC up by 1.00%, Kotak Mahindra Bank up by 0.74% and Asian Paints up by 0.66%. On the flip side, Mahindra & Mahindra down by 3.42%, Infosys down by 1.62%, Power Grid down by 1.41%, Indusind Bank down by 1.32% and Sun Pharma down by 1.15% were the top losers.

Meanwhile, India Ratings and Research (Ind-Ra) has said that the Reserve Bank of India’s (RBI's) monetary policy committee (MPC) is expected cut benchmark interest rate by 25 basis points in its policy review meeting next month to push growth. It said ‘We expect the headline inflation in FY25 to cool off to 4.7 per cent. Monetary easing may be limited to 75 bps in FY26’. However, if the impact of US reciprocal tariff turns out to be higher than expected, there may be higher easing by RBI. The RBI's monetary policy committee is scheduled to meet 6 times in the next fiscal 2025-26 beginning April 1. The first meeting is slated for April 7-9.

Ind-Ra said higher and stubborn inflation had prompted the RBI to tighten the monetary policy, and it raised the policy rate by 250 bps between May 2022 and February 2023, reaching 6.5 per cent. In February 2025, the repo rate was cut by 25 bps to 6.25 per cent. It expects the headline retail inflation in March quarter of FY25 to fall below 4 per cent, after a gap of 21 quarters. It expects RBI to go in for maximum three rate cuts in FY26, aggregating to 75 bps. 

It said ‘These along with one rate cut in February 2025 would translate in a 100bps cut in the current policy easing with the terminal repo rate at 5.5 per cent and average inflation at around 4 per cent, which would translate in a real repo rate of 1.5 per cent in FY26’. It added the February 2025 MPC minutes suggest that the RBI is cognizant of slowing growth momentum. This suggests that while the low and stable inflation is the prime target of the RBI, the growth support through monetary policy will increasingly be a focus area of monetary policy.

The CNX Nifty is currently trading at 23520.90, down by 71.05 points or 0.30% after trading in a range of 23504.95 and 23629.70. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Product up by 4.08%, ONGC up by 2.61%, Nestle up by 1.85%, Hindustan Unilever up by 1.43% and ITC up by 1.32%. On the flip side, Mahindra & Mahindra down by 3.37%, Wipro down by 1.98%, Cipla down by 1.78%, Infosys down by 1.76% and Power Grid down by 1.54% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 876.48 points or 2.32% to 36,923.49, Taiwan Weighted lost 399.95 points or 1.82% to 21,551.81, Hang Seng declined 225.03 points or 0.95% to 23,353.77, KOSPI dropped 48.18 points or 1.85% to 2,558.97 and Shanghai Composite weakened 24.07 points or 0.72% to 3,349.68, while Straits Times was up by 5.91 points or 0.15% to 3,987.48.