Nifty 50, Sensex resume bull run after 1-day hiatus amid gains in financials; PSU banks top gainers

Stock market today: Indian markets, which opened lower on Thursday, March 27, tracking weak global cues, quickly reversed their losses as financial stocks led a rebound, bringing the frontline indices back into the green after a sharp sell-off in the previous session.

The rebound in oil & gas, realty, and metal stocks has supported the indices, helping them stay higher, offsetting the underperformance in the auto sector after Donald Trump announced tariffs on all auto imports, effective April 2.

The Nifty 50 ended the session with a 0.45% gain, settling at 23,591 points, while the Sensex rose 318 points (0.41%), closing at 77,606 points. Broader markets also rebounded from their two-day slump, with the Nifty Midcap 100 index gaining 0.37% to close at 51,839, while its peer, the Nifty Smallcap 100, recorded a stronger gain of 1.15%, rebounding above 16,000 to settle at 16,119 points.

On Wednesday, Donald Trump announced a 25% tariff on auto imports on Wednesday, a move the White House claims would foster domestic manufacturing but could also financially strain automakers reliant on global supply chains.

The action came ahead of a broad array of additional levies expected to be revealed next week. Trump on Tuesday said these tariffs will likely be more “lenient than reciprocal,” reflecting a softened stance that added onto reports from earlier this week that the duties could be more narrow in scope and that sector-specific tariffs are expected to be delayed.

Uncertainty surrounding the scale of US tariffs, the possibility of retaliatory measures from trading partners, and the potential ripple effects on the global economy and businesses have kept investors on edge over the past month.

The trade tensions have also led to fears that the US economy might slip into recession, with the latest economic data strengthening those fears. Those concerns have also reflected in the global markets, with the S&P 500 and Nasdaq into correction territory earlier this month, briefly dipping more than 10% from a record high set in February.

Meanwhile, to boost capital inflows, the Indian central bank is set to double the cap on investment by individual foreign investors in listed companies to 10%, according to two senior government officials and documents reviewed by Reuters.

Sectoral Watch: PSU banks lead; auto, pharma stocks slide on trade fears

Auto and pharma were the only two sectoral indices that ended the session in the red as trade tensions escalated further following the Donald Trump administration’s imposition of 25% tariffs on automobile imports, which fueled concerns that drug imports could be the next target in his next wave of tariffs, adding pressure to the pharma sector.

Against this backdrop, the Nifty Auto index dropped 1.12%, while the Nifty Pharma index ended the session down 0.34%.

On the winning side, Nifty PSU Bank emerged as the top sectoral gainer, rallying 2.32%, followed by Nifty Media, Nifty Oil & Gas, Nifty Realty, Nifty Metal, Nifty IT, and Nifty FMCG, all closing with gains ranging between 0.5% and 1.25%.

Commenting on market performance, Vinod Nair, Head of Research, Geojit Investments Limited, said, "Domestic indices-maintained optimism throughout the day, driven by sustained foreign fund inflows and the purchase of blue-chip stocks. However, the 25% tariff on auto imports imposed by Trump has affected auto stocks and raised concerns within the pharma sector."

"Despite these challenges, the broader market demonstrated resilience, supported by expectations of double-digit earnings growth in FY26, driven by easing inflation and a downward trend in interest rates, which are anticipated to improve domestic fundamentals. Attention is now focused on the US-India trade meeting, which commenced on Wednesday, aiming to provide greater clarity on the bilateral trade agreement between the two nations," he further added.

Technical Outlook

Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates Ltd, said, "Technically, on the daily chart, Nifty found support around the 100-Days Exponential Moving Average (100-DEMA), placed near 23,390, and formed a green candle, indicating strength. However, on the upside, the index is still facing resistance near the 23,800–23,810 levels. If the index sustains above 23,810, the rally could extend towards 24,000–24,080 levels, where its 200-Days Simple Moving Average (200-DSMA) is placed. Traders are advised to follow a "buy on dips" strategy in Nifty as long as it holds above the 100-DEMA support of 23,390."

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.