Indian equity indices opened higher on Wednesday, buoyed by fresh optimism over a potential trade agreement between New Delhi and Washington, as investors looked ahead to the quarterly earnings season for market cues.
The NSE Nifty 50 opened at 25,588.30, up 46.50 points or 0.18 per cent, while the BSE Sensex rose by 93.43 points or 0.11 per cent to open at 83,790.72.
While the positive start lifted sentiment, analysts remained cautious about short-term prospects, citing continued foreign portfolio investor (FPI) outflows and volatility in global markets.
“US markets saw a mild selling in Big Tech names to start July. Asian markets are down this morning on tariff concerns as Trump criticises Japan's stand on US tariffs,” said Ajay Bagga, a banking and market expert. “Indian markets have seen two days of net FPI outflows this week. That is keeping Indian stocks in a tight range despite many tailwinds in the form of a strong macro, policy continuity, monetary easing and fiscal rectitude. Earnings will provide the next catalyst for global and Indian markets.”
Investor sentiment in India was also buoyed by President Donald Trump’s renewed assurances that a US-India trade deal was imminent. Trump, speaking on Tuesday local time, said the agreement would include “much less tariffs”, thereby enabling both economies to compete on fairer terms.
Also read: Trump signals US-India trade deal with ‘much less tariffs’
On the monetary front, the US Federal Reserve signalled restraint. Chair Jerome Powell, in his latest remarks, said the central bank would "wait and learn more" about tariff impacts before considering interest rate cuts. His remarks come amid sustained pressure from Trump, who continues to advocate immediate and deeper cuts to stimulate the economy.
Meanwhile, on the commodities front, gold prices edged lower in early trade. Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services, observed: “Gold prices edged lower in early morning trade, as investors awaited US payroll data and assessed Federal Reserve Chair Jerome Powell's cautious stance on rate cuts, although a weaker dollar helped limit losses. Dollar index weakened to its lowest point in more than three years.”
In Washington, the Senate narrowly passed Trump’s tax-and-spending bill, which includes wide-ranging tax cuts, defence allocations, and reduced funding for social welfare schemes.
Asian equities reflected a mixed trend. Japan’s Nikkei 225 fell by 1 per cent, South Korea’s KOSPI shed 1.2 per cent, and Taiwan’s weighted index slipped 0.34 per cent. However, Hong Kong’s Hang Seng gained 0.68 per cent, while Singapore’s Straits Times rose 0.38 per cent.
With corporate results for the April–June quarter due shortly, Indian markets are likely to remain range-bound until stronger directional signals emerge.
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