Indian benchmark indices are poised for a positive opening on Monday, buoyed by the news of U.S. President Donald Trump's decision to postpone the imposition of tariffs on goods imported from the European Union. This development has eased immediate concerns over escalating trade tensions, providing a fillip to investor sentiment.
As of 8:09 a.m. IST, GIFT Nifty futures were trading at 24,935.5, signaling that the Nifty 50 is likely to commence trading above its previous closing mark of 24,853.15. The delay in tariff implementation offers a temporary reprieve in the ongoing trade disputes between the U.S. and other major economies. Trump's decision to extend the deadline for trade negotiations with the EU until July 9 came after the EU's chief executive indicated that the bloc required more time to achieve a satisfactory agreement.
The broader Asian markets have also responded positively to this development, with the MSCI Asia ex-Japan index registering a gain of 0.2%. Concurrently, oil prices have experienced a slight uptick, driven by reduced anxieties regarding a potential decline in fuel demand.
The Indian stock market has demonstrated robust performance in recent weeks, with the Nifty 50 index climbing 5.7% since early April. This upward trajectory has been fueled by consistent foreign fund inflows, encouraging corporate earnings reports, and the anticipation that India will remain relatively unaffected by the tariff disputes initiated by the U.S. Despite this positive momentum, the index remains 5.4% below its record high recorded on September 27, 2024.
On Friday, foreign portfolio investors (FPIs) made substantial purchases of Indian equities, amounting to 17.95 billion rupees ($211.14 million), bringing the net inflows for May to $1.64 billion. This sustained interest from foreign investors underscores the attractiveness of the Indian market amid global uncertainties.
Looking ahead, investors will closely monitor key domestic economic indicators, including the release of India's Q4 GDP data scheduled for May 30 and the Reserve Bank of India's (RBI) policy decision on June 6. Positive signals from these events could further bolster market confidence and enhance expectations for corporate profitability.
Market analysts suggest that while short-term momentum remains favorable, potential global trade risks and upcoming data releases could introduce volatility.
In specific stock-related news, JSW Steel reported a lower-than-expected increase in its March quarter profit, impacted by subdued steel prices. The Supreme Court of India dismissed Bharti Telemedia's appeal against a high court ruling regarding the levy of entertainment tax on DTH services. Conversely, Linde India announced a 12.3% increase in its March quarter net profit.
