FPJ News Service New Delhi

Domestic equities eased on Monday as investors opted to book profits after the recent rebound, against a backdrop of subdued global sentiment and a strengthening US dollar. The 30-share BSE Sensex fell by 277.93 points to close at 84,673.02, while the 50-share NSE Nifty slipped 103.40 points, ending the session at 25,910.05.

“A flight to quality—particularly into dollar-denominated assets—may prompt a reversal of the greenback’s recent weakness. For borrowers, a firmer dollar has the potential to erode some of the financing “spark,” especially for those carrying unhedged dollar liabilities. Conversely, it enhances export competitiveness and boosts commodity prices, which may offset part of the strain. Technically, market sentiment is likely to remain cautious until tariff-related uncertainties are resolved,” international analysts opined.

“Expectations of a US Federal Reserve rate cut next month have receded, weighing on sentiment. IT, metal and realty stocks declined amid the stronger dollar, while private-sector banks offered some support,” said Vinod Nair, Head of Research at Geojit Investments.

“Persistent uncertainty arising from trade tensions may continue to dampen foreign portfolio inflows,” a senior trade economist noted. The possibility that major domestic corporates may delay significant investments in sectors exposed to global trade cannot be ruled out. Even so, the long-term growth potential of the Indian market remains intact.

According to Dr V. K. Vijayakumar, Chief Investment Strategist at Geojit Investments, three favourable factors could underpin a market rally. First, official White House sources suggest that the United States is close to a trade agreement with India. Secondly, the ebbing of the AI-driven trade cycle may work to India’s advantage. Thirdly, improving fundamentals—evident in resilient growth and rising earnings—provide a supportive backdrop. These three factors collectively point to the likelihood of a modest rally in Indian equities.