Equity market indices Sensex and Nifty moved marginally higher in morning trade on Tuesday after a low-key start following caution on part of investors for the official release of a trade deal with the US. Bull trend in Asian exchanges and fresh foreign fund inflows also helped the early lost ground to recover, according to experts.
"Now, we have negotiated with the United Kingdom, we've negotiated with China… We're close to actually negotiating a deal with India. With some others that we've met and we don't believe we're going to be able to make a deal, so we just wrote 'em a letter. If you wanna play ball, this is what you gotta pay," Trump said on Monday.
The remarks were made as the Trump administration released the first tranche of "letters" to a number of nations on Monday detailing the tariffs America will place on products from those nations coming into the US.
The countries to whom those letters, signed by Trump, were sent included Bangladesh, Bosnia and Herzegovina, Cambodia, Indonesia, Japan, Kazakhstan, Lao People's Democratic Republic, Malaysia, Serbia, South Africa, South Korea, Thailand, and Tunisia.
In the Asian markets, South Korea's Kospi, Japan's Nikkei 225 index, Shanghai's SSE Composite index and Hong Kong's Hang Seng were in positive territory.
"The unexpected announcement of unilateral tariffs on 14 countries and the fact that India has been excluded from that list and even a statement by President Trump that 'we are close to a deal with India' indicate that India-US trade agreement would be announced in no time. The market has already priced this out to a large extent; the suspense is in the details of possible sectoral tariffs on sub-segments like pharmaceuticals. Market response would depend on these details," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.
US markets closed in the red on Monday.
International oil benchmark Brent crude declined 0.36 per cent to USD 69.33 a barrel.
Also read: Trump threatens extra 10 pc tariff on BRICS members
Foreign Institutional Investors (FIIs) bought equities worth ₹321.16 crore on Monday, according to exchange figures. Domestic Institutional Investors (DIIs) bought equities worth ₹1,853.39 crore.
Having seesawed between highs and lows on Monday, the Sensex at long last ended 9.61 points, or 0.01 per cent, higher at 83,442.50. The Nifty ended stable at 25,461.30.
The rupee strengthened 22 paise at 85.72 against the US currency in early trade following fall in global crude oil prices and weakening greenback.
FIIs flows and a supportive local equity market also helped shore up the local currency, forex dealers noted. The rupee began trading at 85.75 against the US currency in the interbank foreign exchange before strengthening to 85.72, 22 paise more than its previous close. The local currency experienced a steep fall of 54 paise to close at 85.94 against the US currency on Monday.
"The rupee recuperated on closure yesterday (Monday) as it had weakened with higher dollar demand. Importers and oil firms continued to buy dollars while RBI can sell some of it during the closure, propelling rupee higher," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.
"The rupee opening (on Tuesday) is slightly higher after some rebound in Asian currencies this morning and it may remain in the range of 85.40-86.00," he added.
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