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Key gauges continue to trade lower in morning deals
May-22-2025

Indian equity benchmarks continued to trade lower in morning deals, mirroring weak trends in global equities amid the US fiscal worries along with debt concerns. Traders overlooked report of global rating agency Fitch Ratings in which it has raised India's medium-term growth potential by 0.2 percentage points to 6.4 per cent compared with 6.2 per cent previously. The revision comes on the back of a sharper rise in India's labour force participation rate in recent years. While the agency expects this growth to continue, it may happen at a slower pace going forward. Traders also paid no heed towards exchange data showed Foreign Institutional Investors (FIIs) turned buyers on Wednesday after a day's breather. They bought equities worth Rs 2,201.79 crore. On the global front, Asian markets are trading mostly in red following losses in Wall Street on concerns about the US’s ballooning deficit. 

The BSE Sensex is currently trading at 80949.52, down by 647.11 points or 0.79% after trading in a range of 80727.11 and 81323.24. There were 3 stocks advancing against 26 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.15%, while Small cap index was up by 0.29%.

The top gaining sectoral indices on the BSE were Telecom up by 0.45%, Realty up by 0.35%, Industrials up by 0.29% and Capital Goods up by 0.26%, while FMCG down by 1.18%, Auto down by 1.09%, Consumer Durables down by 1.02%, Energy down by 0.98% and Oil & Gas down by 0.77% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.98%, Tata Steel up by 0.80%, Bharti Airtel up by 0.58% and Eternal up by 0.00%. On the flip side, Power Grid Corporation down by 2.19%, ITC down by 1.61%, Reliance Industries down by 1.48%, Nestle down by 1.35% and Hindustan Unilever down by 1.35% were the top losers.

Meanwhile, Ratings agency Crisil has said that domestic automotive component sector is expected to clock 7-9 per cent revenue growth this fiscal (FY26), mirroring last fiscal, driven by sustained demand momentum from two-wheelers and passenger vehicles segments especially utility vehicles, which account for nearly half of the overall revenue. It also said that while a moderate uptick in commercial vehicles and tractors sales (around 17 per cent share) will provide an additional tailwind, the aftermarket segment (15 per cent share in revenue) is seen ticking along steadily at 5-7 per cent.

However, weak demand for new vehicles in the US and Europe (around 60 per cent of India's exports), presents headwinds. Poonam Upadhyay, Director at Crisil Ratings, said ‘Demand from automotive OEMs, contributing two-thirds of total revenue, is expected to grow 8-9 per cent this fiscal, with value outpacing volume on rising safety, emission and electronic content, especially in PVs and 2Ws.’

The aftermarket segment will log a steady 6-7 per cent growth, supported by an ageing vehicle base, she said, adding export growth, however, will moderate to 7-8 per cent amid weak demand for internal combustion engine vehicles and a deceleration in electric vehicle adoption across the US and Europe. The US, while contributing just around 5 per cent to total revenue, commands a dominant 28 per cent share of export earnings and is the fastest-growing auto component market, said Crisil.

Besides, ratings agency said the 25 per cent tariff planned by the US can hurt companies heavily reliant on this geography. According to it, operating margins are seen stable at 12-12.5 per cent, driven by growing share of high-margin components such as ADAS (Advanced Driver Assistance System) modules, infotainment systems and advanced braking.

The CNX Nifty is currently trading at 24613.55, down by 199.90 points or 0.81% after trading in a range of 24541.60 and 24737.50. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 3.18%, Tata Steel up by 0.80%, Bharat Electronics up by 0.73%, JIO Financial Services up by 0.56% and Bharti Airtel up by 0.49%. On the flip side, Power Grid Corporation down by 1.99%, ITC down by 1.71%, Mahindra & Mahindra down by 1.56%, Trent down by 1.53% and Bajaj Auto down by 1.50% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 383.35 points or 1.03% to 36,915.63, Taiwan Weighted lost 123.21 points or 0.57% to 21,680.70, Hang Seng declined 131.9 points or 0.56% to 23,695.88, KOSPI dropped 28.62 points or 1.09% to 2,596.96, Straits Times fell 12.79 points or 0.33% to 3,869.76 and Jakarta Composite gained 42.57 points or 0.6% to 7,185.03, while Shanghai Composite strengthened 0.06 points or 0% to 3,387.63. 
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