Sensex, Nifty decline as trade deficit, weak exports weigh on investor sentiment
Indian stock markets opened lower on Tuesday as weak export data and a record-high trade deficit in November dampened investor sentiment.
The Nifty slipped 0.3% to 24,599 points as of 09:20 a.m, while the Sensex fell 0.3% to 81,492.02.
Market experts cited the widening trade deficit as the key factor affecting sentiment. Ajay Bagga, a banking and market expert, emphasized the implications of November’s trade deficit, which surged to a record $37.8 billion from $27.1 billion in October. “The economic data underscores the need for intervention by the RBI. A rate cut is increasingly likely as the rising trade deficit poses risks of further rupee depreciation,” Bagga said.
Bagga criticized the RBI’s recent approach, adding, “The central bank has used over $50 billion in FX reserves to support the rupee, which has been counterproductive. A depreciation of the rupee could have boosted export competitiveness while curbing imports.” He further called for monetary easing and liquidity injections to address the economic challenges.
In sectoral performance, selling pressure dominated, with Nifty Bank, Nifty Auto, and Nifty IT indices opening in the red, while Nifty FMCG, Nifty Media, and Nifty Pharma recorded gains.
Among Nifty 50 stocks, 16 gained while 34 declined in early trading. Cipla, Tata Motors, Tech Mahindra, Adani Ports, and BEL emerged as top gainers, while Shriram Finance, Grasim, Reliance, Eicher Motors, and Britannia led the losers’ list.
Akshay Chinchalkar, Head of Research at Axis Securities, provided a technical outlook, said, “For today, resistance is seen between 24,726 and 24,800, with support in the 24,554–24,580 range. Notably, Friday’s low held at the Bollinger-middle line, suggesting active buyer interest despite reduced volumes and higher volatility expected in the coming sessions.”
In Asian markets, a mixed trend was observed. Japan’s Nikkei 225 rose 0.15%, and Taiwan Weighted gained 0.34%, while Hong Kong’s Hang Seng, South Korea’s KOSPI, and Jakarta Composite registered declines of 0.39%.
