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Global trade worries continue to haunt Dalal Street
Feb-10-2025

Indian indices continued to trade lower in late afternoon session on account of global trade worries following Trump’s warning of new tariffs. Trump signalled potential reciprocal tariffs on nations that tax US imports, along with duties on pharmaceuticals, oil, and semiconductors. Recently, Trumps announced 25% tariffs on steel and aluminium raising concerns of higher inflationary pressure, as these are crucial raw material for US businesses and could be a burden on the margins or transferred to consumers, leaving very short room for Federal Reserve to ease interest rate. The investor sentiments further dampened by data showing FIIs continue to offload Indian equities in February so far, as higher U.S. interest rates and a stronger dollar erode the appeal of emerging markets. Moreover, rupee depreciated 45 paise to a record low of 87.95 against the US dollar too dampened sentiments. On the global front, Asian stocks ended mixed, while the European markets opened green despite U.S. President Donald Trump's pledge to impose tariffs on all imports of steel and aluminum. 

The BSE Sensex is currently trading at 77211.48, down by 648.71 points or 0.83% after trading in a range of 77106.89 and 77849.58. There were 4 stocks advancing against 26 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index down by 2.15%, while Small cap index was down by 2.55%.

The top losing sectoral indices on the BSE were Realty down by 3.07%, Consumer Durables down by 2.83%, Metal down by 2.68%, Healthcare down by 2.46% and Utilities down by 2.36%. There were no gainers on the BSE sectoral indices.

The few gainers on the Sensex were Bharti Airtel up by 0.64%, Kotak Mahindra Bank up by 0.51%, TCS up by 0.12% and ICICI Bank up by 0.10%. On the flip side, Tata Steel down by 3.18%, Titan Company down by 3.02%, Power Grid Corporation of India down by 2.96%, Zomato down by 2.87% and Bajaj Finance down by 2.25% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its latest quarterly industrial outlook survey has showed that manufacturing companies reported marginally better demand conditions in Q3:2024-25 vis-a-vis the previous quarter, as reflected in their assessment for production, employment, capacity utilization, exports and order books.

The survey report further noted that input cost pressures are assessed to have risen further during the quarter Q3:2024-25 which impacted profit margins despite some rise in selling prices. Further, business assessment index (BAI) for Q3:2024-25 remained in the expansion terrain close to its level in the previous quarter.

As per the survey report, firms remained optimistic on demand conditions in Q4:2024-25, with modest improvement in production, order books, capacity utilization and exports. Input cost pressures are expected to rise further in Q4:2024-25; pressures from salary outgo are likely to soften, while the pace of rise in selling prices and profit margins are expected to slow down.

The CNX Nifty is currently trading at 23352.20, down by 207.75 points or 0.88% after trading in a range of 23316.30 and 23568.60. There were 10 stocks advancing against 40 stocks declining on the index.

The top gainers on Nifty were Britannia Industries up by 1.24%, Kotak Mahindra Bank up by 0.87%, Bharti Airtel up by 0.71%, Tata Consumer Products up by 0.50% and Wipro up by 0.30%. On the flip side, Trent down by 4.73%, Tata Steel down by 3.15%, Titan Company down by 3.13%, Power Grid Corporation of India down by 3.02% and ONGC down by 2.55% were the top losers.

Asian markets ended mixed; Hang Seng advanced 388.44 points or 1.8% to 21,521.98, Straits Times rose 15.53 points or 0.4% to 3,876.95, Shanghai Composite strengthened 18.5 points or 0.56% to 3,322.17 and Nikkei 225 surged 14.15 points or 0.04% to 38,801.17, while Jakarta Composite plunged 94.44 points or 1.42% to 6,648.14, KOSPI dropped 0.65 points or 0.03% to 2,521.27 and Taiwan Weighted lost 226.13 points or 0.97% to 23,252.14.

European markets were trading higher; UK’s FTSE 100 increased 40.86 points or 0.47% to 8,741.39, France’s CAC rose 16.26 points or 0.2% to 7,989.29 and Germany’s DAX gained 38.28 points or 0.18% to 21,825.28.
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