Mumbai – The Indian stock market faced a rollercoaster ride on March 25, 2025, ending a recent winning streak as profit booking took its toll. After an early surge, the benchmark indices closed lower amid volatile trading conditions, highlighting cautious investor sentiment.
The S&P BSE Sensex, which had opened in the green at 78,296 and even reached an intra-day high of 78,741.69, eventually closed at 78,017.19, gaining a mere 32.81 points or 0.04 percent by the end of the session. Similarly, the NSE Nifty50 settled at 23,668.65, making a modest gain of 10.30 points or 0.04 percent after hitting a peak of 23,869.60.
Despite the small gains, market breadth favored the bears, with 1,019 shares advancing against 2,868 declines, while 107 remained unchanged. The IT sector was the sole gainer, benefiting from solid performances from leading stocks, whereas other sectors like auto, capital goods, and consumer durables fell between 1 and 1.5 percent.
The broader market also reflected the weakness, with the BSE Midcap index declining by 1 percent, while the BSE Smallcap index dropped by 1.6 percent. Major gainers on the Nifty included UltraTech Cement, Trent, and Infosys, while IndusInd Bank and Dr. Reddy’s Labs led the list of laggards.
Market experts attribute the selling pressure to profit booking, triggered by the market's significant rise in recent days. Vikram Kasat, Head-Advisory at PL Capital-Prabhudas Lilladher, stated, "Focus now shifts to the upcoming US GDP growth report for the fourth quarter, scheduled for release on March 27, along with any fresh updates on trade tariffs." This highlights the ongoing nervousness among investors regarding potential global economic trends.
As the market displayed sharp swings throughout the day, it was apparent that traders were taking cautious stances ahead of the essential economic data expected later this week. Technical indicators indicated turbulence, with experts suggesting an eye on the support levels around the 23,600 mark for the Nifty.
Dr. VK Vijayakumar, Chief Investment Strategist with Geojit Investments, warned, "Even though the market momentum favours the bulls, there is no fundamental support to take the market much higher from the present levels, particularly when President Trump’s Damocles sword of reciprocal tariffs is hanging over the head of markets." The uncertainty surrounding U.S. trade policy significantly impacted market sentiment.
The volatility observed during intraday trading was also tied to broader macroeconomic concerns, including fluctuations in global markets. Earlier, the S&P 500 and Nasdaq posted substantial gains, yet this did not translate positively into Indian equities, reflecting a disconnect between global cues and local investor sentiment.
Investors are also bracing for the upcoming Q4 results season, which could further influence market trends in the following weeks. Anshul Jain, Head of Research at Lakshmishree Investment and Securities, explained that the impending monthly expiry on March 27 contributed to the sell-off as traders sought to square off their positions following the recent bull run.
Jain mentioned, "As people took bulk calls during the recent bull run on Dalal Street, they are squaring off their position in bulks. This could be the reason for selling at higher levels in the stock market today." He added that the anticipated stock market holiday on March 31, due to Id-Ul-Fitr, further intensified the need for cautious trading.
"This could also be the reason for investors squaring off their current positions ahead of the fresh tariff row expected at the beginning of next month," said Avinash Gorakshkar, Head of Research at Profitmart Securities, referring to Trump’s recent remarks on tariffs slated to be effective from April 2, 2025.
This complicated web of factors has left investors anxious about what lies ahead. Many analysts, while acknowledging that the current market trend indicates a pause in the bull run, believe a genuine recovery is still within reach as long as the Nifty manages to hold above the key support levels.
For the immediate future, traders will focus on factors that affect investment decisions, with many hoping that robust Q4 results could catalyze market recovery. The ongoing dialogue surrounding trade tariffs is also set to play a pivotal role in shaping market dynamics.
In summary, while market volatility on March 25 illustrates the delicate balance between profit-taking and growth, the anticipation for forthcoming economic indicators like the US GDP report keeps traders alert yet hopeful for a potential resurgence in the Indian stock market.
