Indian markets extended losses on Monday, led by sharper-than-expected cuts for FY25 earnings. The Nifty 50 moved 60 points down, or 0.25%, at 24,087.25, while the Sensex fell 174 points, or 0.22%, and opened at 79,312.13.
Market experts believe that Indian equities will come under more pressure in the coming weeks. One of the factors that have contributed to the same is the attractiveness of the U.S. markets. Confidence among investors in the U.S. has gained from ex-president Trump’s comeback into politics and his policies that are friendly to business. His declared tax cuts have marked up corporate earnings expectations. While both the Dow and S&P 500 are reaching fresh highs. This gets foreign investors pulling money out of India into the States. With the latter performing much better compared to Indian stocks this year.
“With US markets rallying, Indian markets are no longer getting the same tailwind,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. He further added that the FII selling in Indian stocks may continue. And the inflows could shift to the US, given the weak earnings outlook of India.
Sectoral indices also reflected weakness. Most of the sectors were red, with Nifty IT, Nifty Auto, and Nifty Bank among others down in trade. While Nifty Pharma, Nifty Consumer Durables, and Nifty Healthcare bucked the trend. Back home, 14 stocks were advancing in the Nifty 50 index. While 33 stocks were declining during early trade, reflecting strong bearish sentiment.
Several major companies are also slated to report Q2 results for FY25. Including ONGC, Hindalco Industries, Britannia Industries, and Jubilant Foodworks, among others. Their results could also influence mood in the markets, depending on whether they meet or do not meet street expectations.
FPIs have been the prime reason for this fall in the market. Data from National Securities Depository Ltd. shows that FPIs sold equities worth Rs 19,994 crore in the first five days of November alone. This has pulled both Nifty 50 and Sensex down by around 8% each over October.
Technicals suggest a weak outlook for the Nifty. “The index is in a choppy short-term trend, support is seen around 24,000,” said Varun Aggarwal, Managing Director at Profit Idea. The downtrend, if it continues, may take the Nifty to 23,800.
Other Asian markets also felt the heat on Monday with Hong Kong’s Hang Seng falling over 2.6%, South Korea’s KOSPI falling 1%, and Japan’s Nikkei 225 down 0.39%.
ANI
