Sensex, Nifty slip for second day as tariff worries, FII selling weigh

Domestic equity benchmarks ended lower for a second straight session on Tuesday as risk sentiment weakened across markets. Sentiment was hit by renewed tariff concerns after US President Donald Trump warned of higher tariffs on India if it failed to curb purchases of Russian oil. Foreign institutional investors also turned net sellers, adding to liquidity pressure.

Geopolitical tensions further weighed on sentiment following the arrest of Venezuelan President Nicolas Maduro, while volatility edged higher. The Nifty 50 settled below the 26,200 mark, dragged down by private bank stocks. In contrast, healthcare and pharmaceutical shares saw buying interest.

The S&P BSE Sensex declined 376.28 points or 0.44% to 85,063.34. The Nifty 50 index dropped 71.60 points or 0.27% to 26,178.70. In two consecutive trading sessions, the Sensex declined 0.81% while the Nifty fell 0.56%.

In the broader market, the S&P BSE Mid-Cap index fell 0.24% and the S&P BSE Small-Cap index shed 0.39%.

The market breadth was weak. On the BSE, 1659 shares rose and 2520 shares fell. A total of 169 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, down 0.04% to 10.02.

Economy:

India's services sector growth slowed in December, with the HSBC India Services PMI Business Activity Index easing to 58.0 from 59.8 in November, marking the weakest expansion since January while still indicating solid growth. The Composite PMI Output Index also softened to 57.8 from 59.7 in November but remained well above its long-run average, pointing to continued overall economic expansion at a moderated pace.

Numbers to Track:

The yield on India's 10-year benchmark federal paper declined 0.12% to 6.625 compared with the previous session close of 6.633.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 90.1800 compared with its close of 90.3000 during the previous trading session.

MCX Gold futures for 5 February 2026 settlement advanced 0.06% to Rs 138,200.

The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.05% to 98.37.

The United States 10-year bond yield added 0.26% to 4.179.

In the commodities market, Brent crude for March 2026 settlement added 13 cents or 21% to $61.89 a barrel. Crude oil eased slightly as traders assessed the possible impact on crude flows from Venezuela, home to the world's largest oil reserves.

Global Markets:

Most European market advanced on Tuesday as investors track geopolitical developments following the U.S.'s ouster of Venezuelan leader Nicolas Maduro.

Asian indices ended higher, building on a record-breaking rally in global stocks as investors continued to assess ongoing geopolitical tensions following the U.S. attack on Venezuela and capture of ousted leader Nicolas Maduro.

U.S. big oil got a boost from the country's military raid at the weekend that captured Venezuelan President Nicolas Maduro. Crude oil eased back after rising $1 a barrel overnight as traders assessed the possible impact on crude flows from Venezuela, home to the world's largest oil reserves.

Overall, however, the events had a limited effect on risk sentiment, with equities driven more by momentum and currencies focused on macroeconomic data.

U.S. President Donald Trump said he would put Venezuela under temporary American control and that he could order another strike if the South American nation does not cooperate with U.S. efforts to open up its oil industry and stop drug trafficking. He also threatened military action in Colombia and Mexico.

Trump plans to meet with executives from U.S. oil companies later this week to discuss boosting Venezuelan oil production, media reports stated.

Overnight in the U.S., stocks rose even after the U.S. attack on Venezuela, as crude oil prices advanced and investors bet the action would not lead to broader geopolitical conflict.

The Dow Jones Industrial Average gained 594.79 points, or 1.23%, to close at 48,977.18. The 30-stock index also hit a new all-time high in the session. The S&P 500 advanced 0.64% and ended at 6,902.05. The Nasdaq Composite added 0.69%, settling at 23,395.82.

Stocks in Spotlight:

Reliance Industries dropped 4.42% despite the company strongly denying reports that Russian Urals crude shipments were headed to its Jamnagar refinery. Reliance said it has not received any Russian crude for nearly three weeks and expects none in January, reiterating that it halted the use of Russian oil at its export-oriented unit in November 2025 amid rising geopolitical and regulatory risks, including US tariff threats under Donald Trump. The company also flagged inaccuracies in vessel tracking data and said it is shifting to diversified, non-Russian crude sourcing to avoid sanctions risks and maintain access to global markets.

Trent fell 8.62% after its Q3 FY26 business update showed steady but slowing momentum. While standalone revenue rose 17% YoY to Rs 5,220 crore and nine-month revenue increased 18% YoY, investors were concerned about flat sequential growth and a moderation compared with the stronger growth seen in recent quarters.

HDFC Bank fell 1.56% despite reporting double-digit loan growth in the December quarter. While advances rose 12% YoY and deposits grew 11.5%, investor concerns centred on the loan-deposit ratio, which increased to nearly 99%, well above management's near-term target of below 90%. The elevated ratio has renewed worries over deposit constraints and raised questions about the bank's ability to sustain above-industry growth in the coming financial year.

Tata Motors Passenger Vehicles (PV) declined 1.23% after Jaguar Land Rover (JLR)'s Q3 volumes were impacted by a cyber-incident and US tariffs, leading to sharp year-on-year and sequential declines in both wholesale and retail sales.

IndusInd Bank rose 1.70%. The bank reported a 3.8% decline in deposits to Rs 3,94,022 crore as of 31st December 2025 compared with Rs 4,09,438 crore as of 31st December 2024.

LG Electronics India advanced 1.66% after signing an Advance Pricing Agreement with the Central Board of Direct Taxes, eliminating Rs 487.74 crore of tax and royalty-related contingent liabilities and bringing long-term clarity on transfer pricing.

GM Breweries fell 4.32%. The company reported a 91.22% surge in standalone net profit of Rs 42.01 crore in Q3 FY26, compared to Rs 21.97 crore posted in Q3 FY25. Revenue from operations (excluding excise duty) increased 21.89% YoY to Rs 202.14 crore for the quarter ended 31 December 2025.

KSH International rallied 3.34% after the company's consolidated net profit surged 129.02% to Rs 29.59 crore on a 50.73% increase in revenue from operations to Rs 712.14 crore in Q2 FY26 over Q2 FY25.

MOIL added 3.59% after the company said that it has achieved a record manganese ore production of 4.77 lakh tonnes in Q3 FY26, registering a growth of about 3.7% over the corresponding period last year (CPLY).

Dev Information Technology rose 1.78% after the company announced that it had secured an order worth about Rs 26 lakh from Core Technologies.

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