ONGC Climbs 2.13% as Top Nifty50 Gainer While Trent Falls 3.38%
The Indian stock market experienced significant declines on Wednesday, January 8, 2025, following muted global cues and investor caution. At noon, the BSE Sensex was down by 532.21 points, or 0.68%, trading at 77,666.90, while the Nifty50 lost 158.30 points, or 0.67%, to trade at 23,549.60. The downturn reflects a combination of weak sentiment driven by global and domestic factors.
Key Movers in the Indian Market
On the 30-stock BSE Sensex, only five stocks traded in the green. Reliance Industries led the gainers, climbing 1.66%, followed by Maruti Suzuki India, TCS, Asian Paints, and Mahindra & Mahindra. In contrast, the session saw significant losses for Adani Ports & SEZ, which fell 2.75%, followed by Zomato, Titan, SBI, and Tech Mahindra.
On the Nifty50, 39 stocks traded lower. Trent emerged as the biggest loser with a 3.38% decline, followed by Shriram Finance, Adani Ports & SEZ, Titan, and SBI. However, gains were led by ONGC, which rose 2.13%, alongside Dr. Reddy’s, Reliance Industries, BPCL, and Maruti Suzuki India. The broader market indices also faced challenges, with the Nifty Midcap 100 and Nifty Smallcap 100 down by 1.77% and 1.79%, respectively.
Sectoral Performance
All sectoral indices were trading in the red. The Consumer Durables Index was the top laggard, plunging 3.50%. Other sectors such as Realty, PSU Bank, Banking, Financial Services, Metal, and IT experienced cuts exceeding 1%. The market’s performance highlights broad-based selling, with investors showing caution amid weak domestic and global factors.
Global Cues and Economic Influences
Global factors significantly influenced the Indian stock market’s performance. Higher benchmark Treasury yields, better-than-expected services sector activity in December, and a surprise increase in US job openings fueled speculation that the Federal Reserve may reduce the pace of rate cuts in 2025. These developments caused Wall Street indices to end in the red overnight, with technology and communication services stocks among the biggest losers.
Domestically, investor sentiment was affected by the release of First Advance Estimates from the National Statistics Office (NSO), projecting India’s GDP growth to slow to 6.4% in FY25, the lowest in four years. This figure falls short of the Reserve Bank of India’s (RBI) projection of 6.6% and represents a significant deceleration from the 8.2% growth recorded in FY24. A slowdown in government capital expenditure and sluggish private investments were key factors cited for this moderation.
Mutual Fund and Asset Allocation Insights
The cautious market sentiment has prompted asset managers to recommend diversified investment strategies. Aditya Birla Sun Life Mutual Fund highlighted the importance of asset allocation in 2025, suggesting that investors focus on fixed-income investments, which are expected to deliver returns of 8-9%. Precious metals like gold and silver are forecasted to yield 8-12% returns, while equity markets are predicted to offer moderate returns of 8-12%.
Despite current challenges, infrastructure growth driven by rural spending may boost overall consumption growth in FY25, providing some silver linings to an otherwise subdued economic outlook.
Banking and IT Sector Updates
The banking sector is expected to post modest profit growth in the December quarter (Q3FY25), with the net profit of 19 listed banks forecasted to grow at 9.7% year-on-year. Pressure on margins, reduced credit off-take, and higher credit costs are factors weighing on profitability.
On the other hand, the IT sector is likely to report improved revenues for Q3FY25 on a year-on-year basis. Major players such as TCS, Infosys, HCL Technologies, and Wipro are projected to post growth rates ranging from 0.1% to 7% year-on-year. The sector’s performance will be closely monitored for signs of recovery amid global uncertainties.
Primary Market Developments
In the primary market, several IPO activities are taking place. The Standard Glass Lining Technology Limited IPO is set to close subscription today, while the Quadrant Future Tek Limited IPO and Capital Infra Trust InvIT are in their second day of bidding. In the SME segment, Leo Dry Fruits and Spices Trading Ltd is listing its shares, and Fabtech Technologies Cleanrooms Limited is finalizing its basis of allotment. These developments indicate continued activity in both the mainline and SME segments of the IPO market.
Global Market Sentiment
Asian markets presented a mixed picture during today’s session. Japan’s Nikkei 225 and Topix indices were down by 0.8% and 0.82%, respectively. However, South Korea’s Kospi rose by 0.29%, while Australia’s S&P/ASX 200 gained 0.39%. Hong Kong’s Hang Seng Index and China’s Shanghai Composite Index posted marginal losses, reflecting cautious investor sentiment.
In the United States, Wall Street indices ended lower on Tuesday as strong economic data suggested resilience in the American economy. The Dow Jones Industrial Average fell by 0.42%, the S&P 500 by 1.11%, and the Nasdaq Composite by 1.89%. The decline was driven by losses in technology, consumer discretionary, and communication services stocks. On the other hand, energy and healthcare stocks showed gains.
Commodity and Currency Markets
Commodity markets saw gains in key segments. Oil prices rose on concerns over supply constraints from Russia and Iran, combined with expectations of higher demand from China. Brent crude futures settled at $77.05 per barrel, up 0.98%, while WTI crude finished at $74.25 per barrel, gaining 0.94%.
Gold prices also edged higher as investors sought safe-haven assets. Spot gold rose by 0.53% to $2,649.38 per ounce, while US gold futures settled 0.7% higher at $2,665.40. These gains underscore the appeal of precious metals amid ongoing economic uncertainties.
In the currency market, the US dollar index rose by 0.33% to 108.67, supported by strong economic data from the United States. Benchmark 10-year Treasury yields hit an eight-month high, reaching 4.699%, reflecting investor expectations of slower rate cuts by the Federal Reserve.
The Indian stock market’s performance today reflects a confluence of global and domestic factors, including muted economic data, cautious investor sentiment, and ongoing global uncertainties. While equity markets remain under pressure, sectors like IT and commodities like gold and crude oil are witnessing resilience.
The outlook for the coming weeks will depend on corporate earnings for Q3FY25, macroeconomic developments, and global cues. Investors are expected to tread cautiously while focusing on long-term opportunities amid short-term volatility. With significant activity in the primary markets and a mixed global landscape, the market is poised for an interesting phase as it navigates challenges and seeks growth opportunities.
