Fag-end selling drags Nifty 50 lower for 6th day even as Sensex ends higher on gains in financials

Stock market today: Indian markets wrapped up the trading session on Tuesday, February 25, on a flat note as lacklustre sentiment prevailed throughout the day. However, Indian frontline indices outperformed their Asian peers, which ended with sharper losses after U.S. President Donald Trump signed a memorandum directing the Committee on Foreign Investment in the U.S. (CFIUS) to restrict Chinese investments in strategic sectors. Additionally, his decision to proceed with tariffs on Canada and Mexico prompted investors to trim risky bets.

These restrictions on China, however, led to sharp declines in Indian metal stocks, as experts believe they could impact metal demand in China, the world's largest consumer and producer of metals, potentially affecting the prices.

The Nifty 50 ended the session with a minor decline of 0.03%, closing at 22,547, while the Sensex finished at 74,602, gaining 0.20% compared to Monday's closing price, as financial stocks helped the index break its five-day losing streak.

The Nifty Midcap 100 index concluded the session with a drop of 0.88%, closing at 49,702, while the Nifty Smallcap 100 index finished the session with a cut of 0.44% at 15,408. Meanwhile, Indian markets will remain closed on Wednesday due to Mahashivratri.

Commenting on today's market performance, Vinod Nair, Head of Research, Geojit Financial Services, said “The domestic market experienced a range-bound trading session in anticipation of key economic data releases this week, alongside the monthly expiry. Concerns over high valuations led to continued declines in small and mid-cap stocks. Market sentiment is expected to remain cautious in the near term due to persistent pressure on the INR, ongoing FII outflows, and tariff-related developments."

"Key macroeconomic indicators, including the US Core PCE and GDP data for both the US and India, will be instrumental in shaping expectations for the central bank's future monetary policy," he further added.

Sectoral Watch: Media stocks shine, metals struggle

The Nifty Metal index emerged as the worst sectoral performer in today's session, falling 1.54%, followed by Nifty Realty, which dropped 1.31%. Other sectoral indices, such as Nifty PSU Bank, Nifty Oil & Gas, Nifty IT, and Nifty Pharma, all ended the session with losses ranging from 0.69% to 1.31%.

On the winning side, Nifty Media stood out as the top performer with a gain of 0.84%, while Nifty Consumer Durables, Nifty Auto, and Nifty FMCG ended the session with gains of up to 0.54%.

Trump's series of tariff announcements have shaken investor confidence, leading to reduced participation in equities and a more cautious market sentiment. As a result, front-line indices are trading within a narrow range, reflecting uncertainty and a wait-and-watch approach among market participants.

Trump, on Monday, said tariffs on Canadian and Mexican imports are "on time and on schedule," despite the efforts by both countries to strengthen border security and curb the flow of fentanyl into the U.S. ahead of the March 4 deadline.

Technical Outlook

Rupak De, Senior Technical Analyst at LKP Securities, said, "The index remained mostly muted, except for a small correction towards the close. Sentiment continues to favor the bears as the index sustained below the 21EMA on the hourly chart throughout the day, indicating selling on every rise. On the lower end, support is placed at 22,500, below which sentiment may worsen further. On the higher end, resistance is seen at 22,650 and 22,750-22,800. A rise towards resistance is likely to attract selling pressure."

"Technically, the market continues to exhibit a bearish undertone, with Nifty50 consolidating within its established range, as key support and resistance levels remain intact at 22,400 and 22,800, respectively, signaling the absence of a decisive breakout," said analysts at Bajaj Broking.

Shrikant Chouhan, Head of Equity Research at Kotak Securities, said, "Today, the benchmark indices witnessed lackluster activity, with the Nifty ending 6 points lower while the Sensex was up by 148 points. Among sectors, some buying was seen in media and selective stocks, whereas metal and realty indices corrected sharply, trimming over 1 percent. Technically, after a muted open, the market registered range-bound activity throughout the day. Additionally, on daily charts, it has formed a small candle, and on intraday charts, it is witnessing non-directional activity."

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.