Here's a breakdown of the key overnight developments impacting the Indian stock market:

1. GIFT Nifty Signals a Cautious Opening

The GIFT Nifty, formerly known as SGX Nifty, is an indicator of how the Indian Nifty 50 index may perform at the open. As of today, July 8, 2025, the GIFT Nifty is trading around 25,475.50, a decrease of 0.16% or 40.50 points. This suggests a potentially subdued or slightly negative start for the Indian stock market. GIFT Nifty was trading around 25,499 level, a discount of nearly 40 points from the Nifty futures' previous close, indicating a weak start for the Indian stock market indices.

2. Impact of Trump's Tariffs

US President Donald Trump has announced steep tariffs on several countries, effective August 1, 2025. These tariffs, primarily set at 25%, target key trading partners, including Japan and South Korea, and have introduced uncertainty into the global market. Trump stated that trade ties with both nations were “far from reciprocal” and cited ongoing trade deficits as justification. The announcement follows Trump's earlier threats to impose a 10 per cent universal tariff on imports from over 100 countries starting August 1, 2025. Some analysts believe that the US is pressuring its top 12 trading partners to sign trade deals before that date by threatening higher tariffs.

Impact on Indian Market:

• Cautious Sentiment: The tariff news has generally created a cautious sentiment, with investors carefully monitoring developments.
• Sector-Specific Effects: Export-heavy sectors may face challenges due to increased duties, while domestically focused companies might appear more attractive in the short term. Sectors like automobiles and steel could face strains.
• Broader Macroeconomic Concerns: The tariffs raise questions about foreign exchange rates, trade deficits, and potential inflationary pressures.

3. Samsung's Q2 Results and the Chip Market

Samsung Electronics is expected to release its Q2 earnings report soon. Early estimates suggest a possible 39% drop in operating profit due to weak AI chip sales. The world’s biggest maker of memory chips is projected to report an April-June operating profit of 6.3 trillion won ($4.62 billion), its lowest income in six quarters, according to LSEG SmartEStimate. Despite the current downturn in the chip market, Samsung is actively seeking to increase its share of chip demand in the burgeoning field of artificial intelligence (AI).

4. Asian Market Overview

Asian markets have shown a mixed performance. Japan's Nikkei 225 gained 0.36%, while the Topix index rose 0.31%. South Korea's Kospi index rallied 0.44% and the Kosdaq was up 0.19%. However, the Hong Kong's Hang Seng index futures indicated a weak opening.

5. US Market Performance

The US stock market ended sharply lower on Monday after President Trump announced hefty tariffs on its trading partners. The Dow Jones Industrial Average declined 422.17 points, or 0.94%, to 44,406.36, while the S&P 500 dropped 49.37 points. US indices responded with caution. The S&P 500 dropped 0.27 per cent, the Nasdaq shed 0.50 per cent, and the Dow Jones ended nearly flat.

6. Other Factors Influencing the Market

• US-India Trade Deal: Investors are closely watching for updates on a potential trade deal between the US and India, as this could significantly influence market direction.
• Crude Oil Prices: Fluctuations in crude oil prices remain a key factor, especially for India as a major crude importer.
• Q1 Results: The market is also awaiting the release of Q1 results from various companies, which will provide insights into their performance.

7. Expert Outlook

Ajit Mishra from Religare Broking Ltd. suggests maintaining a "buy on dips" approach, focusing on stock selection based on relative strength. He noted that markets remain in a wait-and-watch mode ahead of trade deal updates and the start of the earnings season.

8. Gift Nifty and its significance

GIFT Nifty provides an opportunity for global investors to participate in India's equity market without the need for local regulations and capital controls. It is an index that tracks the performance of the Nifty 50 but is traded internationally, enabling foreign investors to gain exposure to India's top 50 listed companies via a global platform. The GIFT Nifty is unique in that it operates outside the Indian regulatory framework, offering flexibility and enhanced accessibility to global investors.