MUMBAI– Indian stock markets ended the week sharply lower as persistent FII selling and tariff worries weighed on sentiment, erasing early optimism.
The benchmark Sensex and Nifty declined over 2.2 per cent, with profit booking hitting metals, IT, realty, and auto stocks, which shed between 0.5 and 1.5 per cent. In contrast, Capital Goods, Consumer Durables, Media, and FMCG posted gains of 0.4 to 1 per cent.
Broader markets underperformed, with the Nifty Midcap 100 down 0.57 per cent and the Nifty Smallcap 100 slipping 0.39 per cent.
Markets had opened on a positive note, lifted by expectations of GST rationalisation, a favorable monsoon outlook, and global cues such as easing U.S. bond yields and hopes of a Fed rate cut in September. However, caution took over ahead of the U.S. penalty tariff deadline, sparking three consecutive sessions of broad-based selling. The imposition of tariffs on Indian goods further dented confidence, analysts said.
“Large caps declined, while mid- and small-caps saw sharper losses on stretched valuations and heightened uncertainty,” said Vinod Nair, Head of Research at Geojit Financial Services.
He added that India’s strong April-June GDP growth of 7.8 per cent, driven by government spending and policy measures, could act as a buffer against external risks, though fiscal concerns persist. A resolution of tariff disputes may lift sentiment, but the reciprocal 25 per cent levy is likely to remain in place in the near to medium term.
Textiles, equipment makers, metals, autos, and seafood are expected to be the worst-hit sectors, while IT and pharma may face sentiment pressure despite limited direct impact.
Bajaj Broking noted that Nifty’s immediate support lies at 24,400–24,350, a key retracement zone. “Holding above this level could see the index consolidate between 24,400 and 24,900,” the firm said.
Analysts expect a mixed near-term trend, with consumption-driven sectors such as FMCG, durables, discretionary, cement, and infrastructure set to benefit from GST cuts, strong demand, and higher government spending. (Source: IANS)
