Indian Equity Markets Slip for Fifth Session Amid Trade Deal Uncertainties
On January 9, the Indian equity markets faced a decline for the fifth consecutive session, primarily due to sustained foreign outflows and increasing uncertainties surrounding the trade deal between India and the US, along with fresh tariff threats.
By the closing bell, the Sensex witnessed a loss of 605 points, equivalent to 0.72%, settling at 83,576. Similarly, the Nifty also experienced a dip of 193.5 points, or 0.75%, closing at 25,683.
Investor confidence remained cautious as they awaited a US Supreme Court ruling on the legality of US tariffs and the release of domestic inflation data for December, scheduled for Monday.
Both benchmark indices hit their lowest levels in over two months, with the Nifty trading below the psychological mark of 25,700. Starting at 25,840, the Nifty reached an intraday high of 25,940 before facing profit booking and dropping to an intraday low of 25,648.
Market sentiment was further impacted by US President Donald Trump’s approval of a sanctions bill that could potentially impose 500% tariffs on countries purchasing Russian oil.
Among the major gainers on the Nifty were ONGC and Bharat Electronics. However, the Nifty realty sector experienced the most significant decline, dropping by 2.12%. With the exception of IT, PSU Bank, and Oil and Gas sectors, all other indices traded in the red, with auto down by 1.11% and FMCG and consumer durables down by 1.17%.
Reflecting the trend in benchmark indices, the broader markets also saw a decline, with the Nifty Midcap 100 index losing 0.69% and the NSE Smallcap 100 declining by 0.79%.
Analysts predict that despite ongoing geopolitical challenges, the market is likely to trade within a range with a mixed bias. Strong domestic GDP growth is anticipated to continue, with Q3 results indicating a recovery led by midcaps, potentially stabilizing investor sentiment.
Meanwhile, the rupee weakened by 22 paise to 90.11 against the dollar, influenced by the downturn in domestic equity markets and continuous FII selling.
Conclusion
In conclusion, the Indian equity markets faced a challenging session marked by sustained foreign outflows, uncertainties surrounding trade deals, and fresh tariff threats. While the benchmark indices experienced significant losses, certain sectors like ONGC and Bharat Electronics managed to register gains. It is essential for investors to remain cautious amidst the ongoing geopolitical headwinds, with hopes pinned on strong domestic GDP growth and potential recovery in Q3 results to stabilize market sentiment.
