Indian equity markets opened sharply lower on Wednesday as escalating trade tensions and hawkish comments from the US Federal Reserve Chairman sparked a broad-based sell-off. The Sensex opened at 76,188.24 compared to its previous close of 76,293.60 and is currently trading at 75,622.37, down by 671.23 points or 0.88 per cent. Similarly, the Nifty opened at 23,050.80 against its previous close of 23,071.80 and is now at 22,879.55, losing 192.25 points or 0.83 per cent.
Information technology stocks bucked the negative trend, with TCS leading gains, up 1.13 per cent, followed by Tech Mahindra (+1.10 per cent), Infosys (+0.58 per cent), and HCL Technologies (+0.40 per cent). The tech sector rally comes ahead of the Hexaware IPO opening today.
“The market is gripped by pessimism as fears mount over further declines if Nifty slips below the crucial 23,000 mark,” said Prashanth Tapse, Senior VP (Research) at Mehta Equities. He noted that foreign institutional investors have pulled out ₹1 lakh crore this year amid concerns over Trump’s tariff threats.
Auto and energy stocks faced heavy selling pressure, with Mahindra & Mahindra dropping 3.53 per cent and Reliance Industries falling 3.19 per cent. Other major losers included BEL (-3.13 per cent), Adani Ports (-2.42 per cent), and IndusInd Bank (-2.11 per cent).
Market sentiment remained cautious ahead of crucial US and Indian inflation data due later today. Additionally, investors are closely watching the upcoming meeting between the Indian Prime Minister and US President to discuss trade tariff issues. India’s trade deficit with the the US currently stands at nearly $33 billion.
“The European Union’s declaration that they will retaliate with counter tariffs has raised the probability of a full-blown trade war,” said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. “When higher tariffs raise inflation in the US and the Fed responds hawkishly, the US stock market will crash. This will restrain Trump. But it will take some time.”
In commodities, gold prices declined over 1 per cent to below $2,900 per ounce after Fed Chairman Powell signalled no urgency for interest rate cuts. Oil prices rose 2 per cent to above $76 per barrel on concerns over Russian and Iranian oil supply despite global growth worries.
On the positive side, net direct tax collections rose 15 per cent to ₹17.78 lakh crore till February 10, indicating strong economic growth. Several companies including NBCC, Keystone Retailers, P&G Hygiene, and Schneider Electric announced impressive quarterly results.
Technical analysts suggest the market is in oversold territory, though further weakness cannot be ruled out. “If Nifty falls below 23,000 today, we may experience follow-through selling. Conversely, if the price closes above 23,160, we could observe a bounce,” said Ameya Ranadive, Senior Technical Analyst at StoxBox.
Foreign institutional investors remained net sellers, offloading equities worth ₹4,486 crore on February 11, while domestic institutional investors provided support by purchasing equities worth ₹4,001 crore.