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Markets wipe out opening gains to trade in red in early deals
Apr-25-2025

Indian equity benchmarks made a positive start on Friday following the broadly positive cues from Wall Street overnight as well as firm trade in Asian counterparts as traders remain optimistic about a favorable outcome from the ongoing tariff negotiations between the U.S. and several partner countries, particularly China, Japan, South Korea and India. Comments from two US Fed officials about cutting interest rates also improved market sentiment. However, soon markets wiped out their gains and are trading in red in early deals amid ongoing geopolitical tensions between India and Pakistan.

Downside remained capped as US Treasury Secretary Scott Bessent said that he expects India to strike the first bilateral trade deal to avoid President Donald Trump's reciprocal tariffs. Besides, the commerce ministry said India and South Africa have discussed possibility of settlement of trade in local currency and unified payment linkage system with a view to further strengthen economic ties. 

On the sectoral front, Indian aviation industry stocks are in focus as ICRA said that Indian aviation industry's outlook for 2025-26 remains stable, driven by expectations of moderate growth in domestic air passenger traffic and a relatively stable cost environment. In stock specific development, L&T Technology Services plunged after Q4 net profit slipped 3.5 percent year-on-year.

The BSE Sensex is currently trading at 79644.97, down by 156.46 points or 0.20% after trading in a range of 79635.47 and 80130.66. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.27%, while Small cap index was down by 1.96%.

The only gaining sectoral indices on the BSE were IT up by 0.39% and TECK up by 0.36%, while Industrials down by 1.56%, Telecom down by 1.45%, PSU down by 1.33%, Capital Goods down by 1.32% and Power down by 1.25% were the losing indices on BSE.

The top gainers on the Sensex were TCS up by 1.51%, Infosys up by 1.06%, Reliance Industries up by 0.73%, HCL Technologies up by 0.41% and Titan Company up by 0.29%. On the flip side, Axis Bank down by 3.57%, Adani Ports & SEZ down by 1.90%, Bajaj Finance down by 1.73%, Bajaj Finserv down by 1.26% and Tech Mahindra down by 1.21% were the top losers.

Meanwhile, The Global Trade Research Initiative (GTRI) has said domestic exporters should not use India as a destination for re-routing goods originating from high-tariff countries like China to the US. It added instead of re-routing, Indian exporters should build genuine value addition, supply chain transparency, and adhere to US customs rules. Cautioning against 'shortcuts', GTRI Founder Ajay Srivastava said Indian firms need to build on genuine value addition, supply chain transparency, and comply with US customs rules. For countries like India, the opportunity is real, but only if exporters play by the rules.

He added that exporters often misunderstood US non-preferential rules of origin (RoO), which determine a product's true origin. If a product contains high Chinese content and fails to meet the substantial transformation test, it may still be classified as Chinese, regardless of where it was assembled and subjected to punitive tariffs. The US has imposed tariffs as high as 245 per cent on China, while most other countries continue to enjoy just 10 per cent duties. This disruption is prompting companies to rethink sourcing strategies, giving rise to three distinct trade models, each with different implications for exporters.

It also said that as Chinese exports to the US decline, manufacturers in China may try to offload their surplus in other markets at deeply discounted prices. This could distort prices and hurt domestic industries in countries like India. It added already, the Directorate General of Trade Remedies (DGTR) is keeping a close watch on import trends, especially in sensitive sectors such as steel, toys, chemicals, and synthetic textiles. It said ‘Quick deployment of anti-dumping measures will be essential to protect Indian industry from injury’.

To ensure compliance with US RoO, firms must map and audit the supply chain to identify foreign content; redesign manufacturing processes to ensure domestic transformation of key inputs; and maintain meticulous documentation, including invoices, production steps, and origin declarations. Further, it said India, with its robust and cost-effective API (active pharmaceutical ingredient) manufacturing ecosystem, is well-positioned to absorb a large portion of redirected demand in the chemicals sector. In 2024, the US imported $165.5 billion worth of chemicals, including APIs and other pharmaceutical raw materials, with China supplying 9.7 per cent. To navigate the tariff shock, several countries are poised to step in. Similar opportunities are there for Indian firms in sectors such as machinery, electrical and electronic products, textiles, garments, leather and footwear, ceramic and cement products, and plastics, furniture, toys and medical devices.

The CNX Nifty is currently trading at 24168.80, down by 77.90 points or 0.32% after trading in a range of 24165.55 and 24365.45. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were SBI Life Insurance up by 5.27%, TCS up by 1.37%, Infosys up by 1.01%, HDFC Life Insurance up by 0.94% and Reliance Industries up by 0.53%. On the flip side, Axis Bank down by 3.43%, Bharat Electronics down by 2.09%, Adani Ports & SEZ down by 1.92%, Trent down by 1.85% and Bajaj Finance down by 1.84% were the top losers.

All Asian markets are trading higher; Nikkei 225 surged 761.57 points or 2.17% to 35,800.72, Taiwan Weighted jumped 413.7 points or 2.12% to 19,892.51, Hang Seng soared 307.12 points or 1.4% to 22,216.88, Jakarta Composite gained 62.43 points or 0.94% to 6,675.91, KOSPI increased 28.92 points or 1.15% to 2,551.25, Shanghai Composite strengthened 4.9 points or 0.15% to 3,302.19 and Straits Times was up by 0.28 points or 0.01% to 3,832.20.
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