Sensex sheds 288 pts, Nifty below 25,500 as financials drag despite U.S.-India trade deal hopes
 |
| Sensex sheds 288 pts, Nifty below 25,500 as financials drag despite U.S.-India trade deal hopes |
Indian benchmark indices Sensex and Nifty ended lower on Wednesday, as a pullback in financial stocks from near-record highs outweighed optimism fueled by U.S. President Donald Trump's remarks hinting at a potential trade deal between the U.S. and India.
The BSE Sensex declined 287.60 points, or 0.34%, to close at 83,409.69, while the NSE Nifty shed 88.40 points, or 0.35%, to settle at 25,453.40.
Among the 30 stocks on the Sensex, Bajaj Finance, L&T, HDFC Bank, Bharat Electronics Ltd, and Kotak Mahindra Bank were the top laggards, falling between 0.9% and 2.1%.
Financial services stocks were the biggest drag on the benchmarks, with the Nifty Financial Services index slipping 1% on the day. Index heavyweight HDFC Bank lost 1.3%, weighing heavily on sentiment.
In contrast, metal stocks rallied sharply, with the Nifty Metal index rising 1.4%, buoyed by a global rebound in steel futures amid signs of recovery in China’s manufacturing sector and stronger demand from Western economies. Tata Steel led the charge, jumping 3.7%, followed by a 3% gain in Welspun Corp. NALCO rose 1.1%, Hindalco added 0.6%, and Vedanta advanced 0.8%.
Broader markets also ended in the red, with the Nifty Smallcap 100 down 0.4% and the Nifty Midcap 100 lower by 0.1%.
On the geopolitical front, U.S. President Donald Trump said Tuesday that a trade deal with India could soon be reached, potentially allowing the country to sidestep the 26% retaliatory tariff he announced on April 2, which has been suspended until July 9. U.S. Treasury Secretary Scott Bessent echoed the sentiment, saying both sides are close to finalising an agreement that would avert the tariff hike.
Meanwhile, HDB Financial Services made its debut on the National Stock Exchange at Rs 835 per share, listing at a 12.8% premium over its issue price of Rs 740.
Expert View
Mixed global cues, particularly ahead of the impending tariff deadline, are driving investor caution, said Vinod Nair, Head of Research, Geojit Investments, adding that market attention is gradually shifting to crucial Q1 earnings, which have high expectations.
"Underlying trends such as robust macroeconomic fundamentals and increased government expenditure continue to support market resilience. However, being at the breach level of the recent rally, a cautiousness is expected to continue in the near term," said Nair.
Global Markets
World stocks edged higher on Wednesday, as investors weighed the likelihood of U.S. interest rate cuts and the rush to secure trade deals ahead of President Donald Trump’s July 9 tariff deadline.
Europe’s STOXX 600 rose 0.1% and Germany’s DAX gained 0.3% in early trade. In the U.S., S&P 500 futures pointed to a stronger open after the index pulled back slightly from record highs on Tuesday.
Asian markets saw mixed moves. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1% after a volatile session, while Japan’s Nikkei dropped 0.5% amid lingering trade uncertainty.
U.S. labour market data released Tuesday showed an uptick in job openings for May, keeping focus on the June payrolls report due Thursday as investors look for signals on the Federal Reserve’s next move.
Fed Chair Jerome Powell, facing political pressure to cut rates, said the central bank will “wait and learn more” about the inflationary impact of tariffs before taking action. Markets are currently pricing in 64 basis points of rate cuts this year, with a 21% chance of a July cut, according to Reuters.
In commodities, spot gold dipped 0.2% to $3,331 per ounce after a 1% jump the previous day. The metal remains up 27% this year on continued safe-haven demand.
Crude Impact
Oil prices edged higher on Wednesday as Iran halted cooperation with the U.N. nuclear watchdog, adding geopolitical tension to markets already assessing the prospect of increased supply from major producers next month and a weakening U.S. dollar.
Brent crude rose 60 cents, or 0.9%, to $67.71 a barrel, while U.S. West Texas Intermediate (WTI) gained 55 cents, or 0.8%, to trade at $66.00 by 1017 GMT.
Rupee vs Dollar
The Indian rupee slipped 0.2% on Wednesday to 85.7025 against the U.S. dollar, as the greenback edged higher ahead of key U.S. economic data and mounting anticipation over potential trade deals before the July 9 deadline.
The dollar index, which measures the currency’s performance against a basket of six peers, rose 0.14% to 96.95.
(with inputs from agencies)
0 comments :
Post a Comment