Nifty breaks 10-day slump amid value buying, but trade war fears persist

The domestic equity benchmarks erupted with significant gains on Wednesday. The Nifty soared above the 22,330 mark, shattering a ten-day losing streak. The market's dramatic turnaround was fueled by buoyant global market sentiment, propelling all sectoral indices on the NSE into positive territory. Metal and PSU bank shares spearheaded the rally, demonstrating robust performance. Yet, traders remained cautious, as trade war anxieties haunted global markets. US tariffs triggered retaliation, fanning fears of a widespread conflict.

The S&P BSE Sensex jumped 740.30 points or 1.01% to 73,730.23. The Nifty 50 index surged 254.65 points or 1.15% to 22,337.30. The 50-unit index slumped 3.83% in the past ten consecutive sessions.

Adani Ports & SEZ (up 5.02%), Adani Enterprises (up 4.57%), Mahindra & Mahindra (up 4.27%) and Reliance Industries (up 1.21%) boosted the indices.

The broader market outperformed the frontline indices. The S&P BSE Mid-Cap index advanced 2.66% and the S&P BSE Small-Cap index jumped 2.80%.

The market breadth was strong. On the BSE, 3247 shares rose and 768 shares fell. A total of 86 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, declined 1.15% to 13.67.

Economy:

The seasonally adjusted HSBC India Services PMI Business Activity Index rose from January's 26-month low of 56.5 to 59.0 in February, indicating a sharp rate of expansion that was well above its long-run average.

The HSBC India Composite Output Index rose from 57.7 to 58.8, indicating a substantial rate of expansion. The acceleration in growth was centered in the service economy, as manufacturers registered a slower upturn.

Numbers to Tracks:

The yield on India's 10-year benchmark federal paper was up 1.44% to 6.838 as compared with previous close 6.852.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 87.0725 compared with its close of 87.1900 during the previous trading session.

MCX Gold futures for 4 April 2025 settlement rose 0.08% to Rs 86,095.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, shed 0.50% to 105.02.

The United States 10-year bond yield added 1.02% to 4.253.

In the commodities market, Brent crude for May 2025 settlement lost 80 cents, or 1.13% to $70.24 a barrel.

Global Markets:

US Dow Jones index futures were up 225 points, indicating a strong opening in the US stocks today.

European stocks advanced on Wednesday amid optimism that U.S. President Donald Trump's 25% duties on Canada and Mexico could be relaxed, and that German fiscal rules will be reformed to allow higher defense and infrastructure spending.

Most Asian stocks ended higher as investors assessed China growth and inflation targets amid U.S. tariffs and escalating global trade tensions weighing down sentiment.

Investors are also focused on Chinas "Two Sessions," an annual parliamentary gathering, with the meeting of its top legislature, the National Peoples Congress, kickstarting Wednesday.

China on Wednesday set its GDP growth target for 2025 at around 5%. The country has also lowered its inflation expectations to around 2%.

Trumps 25% tariffs on goods from Mexico and Canada took effect Tuesday. The president also imposed an additional 10% duty on Chinese goods, bringing the total new tariffs on China to 20%.

China's Caixin services PMI came in at 51.4 in February, above expectations for a 50.8 print. The reading was higher than the 51.0 seen in January.

Australias gross domestic product rose 0.6% quarter-on-quarter, data from the Australian Bureau of Statistics showed on Wednesday. The print picked up from the 0.3% seen in the prior quarter. GDP grew 1.3% year-on-year, above expectations of 1.2% and higher than the 0.8% seen in the prior quarter.

United States equities fell on Tuesday, as losses in the Dow Jones Telecommunications, Dow Jones Financials and Dow Jones Consumer Goods sectors led shares lower. The Dow Jones Industrial Average fell 1.55% to hit a new 1-month low, while the S&P 500 index declined 1.22%, and the NASDAQ Composite index declined 0.35%.

Among financials, Morgan Stanley led losses with a 5.7% decline, while JPMorgan Chase & Co and Goldman Sachs fell nearly 4%, each. In automakers, Ford Motor Company slipped 2.9%, while Stellantis NV declined 4.4%, and General Motors Company lost 4.6%. NVIDIAs stock rose 1.6%, after entering a bear market territory in the last session with an over 8% fall.

Buzzing Index:

The Nifty Metal index added 4.04% to 8,685.20. The index has jumped 5.67% in the three consecutive trading sessions.

Hindustan Copper (up 7.20%), Welspun Corp (up 7.03%), National Aluminium Company (up 5.91%), NMDC (up 5.19%), Vedanta (up 5.18%) Adani Enterprises (up 4.53%), Hindustan Zinc (up 3.93%), and Hindalco (up 2.45%) surged.

Shares of steel makers rose on Wednesday following China's plans to restructure its massive steel industry by reducing output. Tata Steel (up 4.55%), Steel Authority of India (up 4.43%), JSW Steel (up 3.48%), JSL (up 3.45%), Jindal Steel & Power (up 3.08%) surged.

China's move, aimed at tackling overcapacity, sparked positive sentiment among investors in Indian steel companies. While China indicated a commitment to "promote restructuring of the steel industry through output reduction," it notably refrained from specifying any concrete reduction targets.

Stocks in Spotlight:

Shares of BSE fell 3.67% after rival National Stock Exchange (NSE) announced a shift in the expiry day for all futures and options (F&O) contracts. Starting April 4, Nifty index weekly F&O contracts will now expire on Mondays instead of Thursdays. Further, all Nifty monthly F&O contracts will now expire on the last Monday of the expiry month, rather than Thursday.

IT firm Coforge soared 8.42% after announcing two acquisitions, a major long-term deal, and a 5-for-1 stock split. The company secured a 13-year, $1.56 billion agreement with US-based travel technology firm Sabre Technologies to enhance product delivery and develop AI-driven solutions.

Larsen & Toubro (L&T) rose 0.80%. The company has announced that its Building & Factories (B&F) vertical has secured significant orders from a reputed developer for the construction of residential towers in Mumbai, Bangalore, and Chennai.

Force Motors gained 3.86% after the company reported 46.28% increase in auto sales to 3,600 units in February 2025 compared with 2,461 units sold in February 2024.

Refex Industries hit an upper circuit of 5% after the company said that its subsidiary, Refex eVeelz, will expands its EV fleet with 1,000 electric cars as part of a strategic partnership with leading ride-hailing platform.

Z-Tech (India) hit an upper circuit of 5% after the company announced that it received orders totaling Rs 9.43 crore from two separate entities.

Bondada Engineering hit an upper circuit of 5% after the company announced that its subsidiary, Bondada Green Engineering, has successfully successfully exported 1982 MT of WS Beams to GameChange Solar Corp, based in Norwalk, Connecticut, USA.

Walchandnagar Industries hit an upper circuit of 5% after the company entered into share subscription and shareholders agreement to acquire 60.3% stake in Aicitta Intelligent Technology Private (Aicitta).

Solex Energy jumped 3.22% after the company successfully commenced full-scale commercial production of solar photovoltaic modules with an 800 MW capacity in Surat, Gujarat.

Power Grid Corporation of India rose 4.27% after the company won tariff-based competitive bids for three build, own, operate, and transfer (BOOT) inter-state transmission projects.

RHI Magnesita India added 2.43% after the firms wholly owned subsidiary, Intermetal Engineers (India) (Intermetal), entered into a share purchase agreement (SPA) with Ashwath Technologies to acquire a 100% stake from its shareholders.

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