Stock market recap: The Indian equity benchmarks faced significant selling pressure on Tuesday, with Nifty 50 plunging 288.35 points (1.12%) to settle at 25,424.65, and BSE Sensex plummeting 1,068.74 points (1.28%) to 82,225.92.
The session saw a "tech bloodbath" as Nifty IT crashed 4.74% to a 30-month low. This rout was triggered by deepening AI disruption fears following Anthropic’s launch of tools capable of automating legacy COBOL systems—a core service area for Indian IT majors. Global sentiment was further dampened by US President Donald Trump’s renewed tariff threats and escalating geopolitical tensions in the Middle East, which pushed crude oil prices higher.
Market breadth remained sharply negative, with an advance-decline ratio of approximately 1:4 in the NSE universe (around 726 advances to 2,005 declines). While Nifty Metal bucked the trend to hit a fresh all-time high, heavyweights like Tech Mahindra, HCL Tech, and Infosys led the laggards, slipping up to 6%.
Two stock recommendations by MarketSmith India:
Buy: Shriram Pistons and Rings Ltd (current price: ₹3,190)
- Why it’s recommended: Strong position in auto components (pistons/rings), diversified OEM + aftermarket revenue, beneficiary of CV/tractor cycle recovery, improving export contribution, and healthy return ratios (ROCE/ROE).
- Key metrics: P/E: 23.64, 52-week high: ₹3,407.20, volume: ₹69.38 crore
- Technical analysis: Trendline Breakout
- Risk factors: Cyclicality of auto sector demand, high dependence on OEM volumes, raw material price volatility, slow EV transition risk to ICE parts, and export demand fluctuations
- Buy: ₹3,175–3,210
- Target price: ₹3,580 in two to three months
- Stop loss: ₹2,990
Buy: R R Kabel Ltd (current price: ₹1,500)
- Why it’s recommended: Strong exposure to housing, infrastructure, and electrification demand, premiumisation and brand-led pricing power
- Key metrics: P/E:36.44, 52-week high: ₹1,562.60, volume: ₹120.66 crore
- Technical analysis: inverted head and shoulder breakout retest
- Risk factors: High sensitivity to copper and aluminium price volatility, intense competition in wires, cables, and FMEG segments
- Buy at: ₹1,490–1,510
- Target price: ₹1,730 in two to three months
- Stop loss: ₹1,390
Nifty 50 recap
Indian equities closed sharply lower on February 24th, with Nifty 50 declining 1.12% (-288.35 points) to settle at 25,424.65, while Sensex fell 1.28% (-1,068.74 points) to 82,225.92. The market witnessed sustained selling pressure throughout the session, led by a steep correction in IT stocks amid global technology concerns. This dragged Nifty IT down 4.74%.
Realty also underperformed, falling to 2.54%. In contrast, select defensive and commodity-linked pockets offered some support, with Metals (+0.93%), Oil & Gas (+0.50%), Pharma (+0.24%), and PSU Banks (+0.29%) closing in positive territory.
Heavyweights such as Infosys, TCS, HDFC Bank, and L&T were among the key drags, partially offset by gains in NTPC, Reliance, and HUL. Broader markets mirrored the weak sentiment, and market breadth remained decisively negative with 1,070 stocks advancing, 2,104 stocks declining, and 99 stocks remaining unchanged out of 3,273 traded stocks.
Nifty continues to hover around its key medium- to long-term moving averages, namely the 50-, 100-, and 200-DMAs, reflecting an ongoing phase of consolidation and lack of clear directional bias.
The flattening of the 20-DMA, along with price oscillating around the 50-day average, indicates fading upside momentum and reduced trend strength in the near term. Momentum indicators also suggest a cautious undertone.
The RSI stands at 45.39, below the neutral 50 mark, pointing to weakening bullish momentum while remaining comfortably above oversold territory. This positioning leaves room for further consolidation or a mild downside drift. Meanwhile, the MACD remains in negative territory, with the MACD line positioned below the signal line, reinforcing the prevailing soft bias.
However, the narrowing histogram suggests that bearish momentum may be moderating, indicating the potential for stabilization if price action improves.
According to O’Neil’s methodology of market direction, the Indian equity market has transitioned from a downtrend to a rally attempt, indicating an early improvement in the near-term market tone.
Nifty once again surrendered the gains of the previous two sessions in a single trading day, underscoring the fragile undertone in the near-term trend. The index continues to hover around its 100- and 200-DMA, indicating a phase of consolidation with a slight negative bias.
A decisive break below 25,300 would likely invite renewed selling pressure, potentially opening the path toward 25,000 in the near term and 24,500 thereafter, which remains a crucial level from a medium-term perspective. On the upside, 25,800–26,000 remains a formidable supply area, with selling interest emerging on prior recovery attempts.
Nifty Bank performance
Nifty Bank opened on a subdued note and traded with a negative bias through the session. After hitting the intraday high, the index witnessed profit booking at higher levels, indicating a lack of follow-through buying. The index opened at 61,392.10, touched an intraday high of 61,435.65, slipped to a low of 60,801.85, and finally settled at 61,047.30, ending the day with a modest loss of 0.35%.
Price action suggests mild distribution near recent highs as traders booked profits after the recent up move. Broader market cues remained mixed, while Banking heavyweights showed selective weakness, keeping the index range-bound and unable to sustain above key short-term averages despite early stability.
On the momentum front, the RSI is placed near 57, indicating neutral to mildly positive momentum with no immediate overbought signals, suggesting the trend still has room to move either way. The MACD remains in positive territory with a narrowing histogram, hinting at slowing bullish momentum and possible consolidation ahead.
Momentum indicators suggest the market is transitioning into a pause phase after the recent rally, with oscillators flattening and signaling reduced directional conviction among traders in the near term.
Technically, immediate support is seen near 60,400, followed by stronger support around 59,800 (50-DMA). On the upside, resistance is placed near 61,700, and a decisive move above this could push the index toward 62,000. Considering the ongoing consolidation and mixed global cues, Nifty Bank is likely to remain range-bound with a slight positive bias if it holds above the 21-DMA.
Any breakout above resistance could trigger fresh momentum buying, while a break below support may lead to short-term corrective pressure amid cautious sentiment in financial stocks.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O'Neil. You can access a 10-day free trial by registering on its website.
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Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.