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Markets trade tad higher in cautious trade in early deals
May-07-2025

Indian equity benchmarks made a negative start on Wednesday, tracking weakness on Wall Street overnight. Rising tensions between India and Pakistan after India's Armed Forces conducted Operation Sindoor, targeting terrorist infrastructure in Pakistan, also weighed on market sentiments. Though, markets eked out some gains and are trading tad higher in early deals amid continued inflows from Foreign Institutional Investors (FIIs). Some support came as India and the UK have finalized a landmark trade agreement aimed at doubling trade to $120 billion by 2030. Besides, Piyush Goyal, the Union Commerce and Industry Minister, said that the Bilateral Trade Agreement (BTA) with the United States is moving progressively in the right direction.

On the global front, Asian markets are trading mostly higher as traders react to China's central bank saying it would cut its key policy rate by 10 basis points and lower the reserve requirement ratio by 50 basis points to boost growth. There is also confirmation that U.S. and Chinese officials are set to start formal trade talks this week. Back home, in stock specific development, One 97 Communications jumped after narrowing its Q4 consolidated loss.

The BSE Sensex is currently trading at 80717.80, up by 76.73 points or 0.10% after trading in a range of 79937.48 and 80844.63. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.04%, while Small cap index was down by 0.32%.

The top gaining sectoral indices on the BSE were Auto up by 0.63%, Bankex up by 0.50%, PSU up by 0.26%, Metal up by 0.21% and Power up by 0.15%, while Realty down by 0.85%, Healthcare down by 0.67%, Consumer Durables down by 0.53%, FMCG down by 0.43% and Telecom down by 0.34% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 3.50%, Bajaj Finance up by 1.02%, Power Grid up by 0.83%, ICICI Bank up by 0.62% and Axis Bank up by 0.53%. On the flip side, Asian Paints down by 1.29%, Titan Company down by 0.94%, HCL Technologies down by 0.89%, Sun Pharma down by 0.86% and NTPC down by 0.83% were the top losers.

Meanwhile, India and the UK clinched a 'landmark' trade deal that will remove taxes on the export of labour-intensive products such as leather, footwear and clothing, while making imports of whisky and cars from Britain cheaper, in a bid to double trade between the two economies to $120 billion by 2030. The world's fifth and sixth-largest economies concluded the deal after three years of on-off negotiations. The pact lowers tariffs on 99 per cent of Indian goods to zero in the UK market while allowing Indian workers to travel to the UK for work without changing Britain's point-based immigration system. 

Taxes on export of Indian clothing, frozen prawns, jewellery and gems will be cut. And so will be the import of whisky and gin from the UK after the treaty halved the tariff to 75 per cent initially and to 40 per cent by the 10th year. Tariffs on automotive imports will go from over 100 per cent to 10 per cent under quotas on both sides, benefiting companies such as Tata-JLR. Indian goods that will enter the UK at zero duty include minerals, chemicals, gems and jewellery, plastic, rubber, wood, paper, textile, clothing, glass, ceramic, base metals, mechanical and electrical machinery, arms/ammunition, transport/auto, furniture, sports goods, animal products, and processed food.

The two have also concluded the negotiations for the Double Contribution Convention Agreement, or social security pact. It would help avoid double contribution to social security funds by Indian professionals working for a limited period in Britain. The commerce ministry said ‘The exemption for Indian workers who are temporarily in the UK and their employers from paying social security contributions in the UK for a period of three years under the Double Contribution Convention will lead to significant financial gains for the Indian service providers’. It added that this pact will enhance competitiveness of domestic professionals in the UK market that would create new job opportunities as well as benefit a large number of Indians working in the UK. 

However, the talks for the bilateral investment treaty (BIT) are still going on. Earlier, there were plans to conclude all three simultaneously. The bilateral trade between India and the UK increased to $21.34 billion in 2023-24 from $20.36 billion in 2022-23. During April-January 2024-25, the trade in goods stood at $21.33 billion as against $20.26 billion in 2023-24. The trade gap is in the favour of India.

The CNX Nifty is currently trading at 24402.85, up by 23.25 points or 0.10% after trading in a range of 24220.00 and 24449.60. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 3.46%, Bajaj Finance up by 1.02%, Power Grid up by 1.01%, SBI Life Insurance up by 0.66% and ICICI Bank up by 0.65%. On the flip side, Asian Paints down by 1.27%, NTPC down by 1.01%, HCL Technologies down by 0.87%, Sun Pharma down by 0.82% and Titan Company down by 0.76% were the top losers.

Asian markets are trading mostly in green; Hang Seng surged 111.24 points or 0.49% to 22,773.95, Jakarta Composite gained 52.06 points or 0.75% to 6,950.26, Nikkei 225 advanced 34.7 points or 0.09% to 36,865.39, Shanghai Composite strengthened 21.12 points or 0.63% to 3,337.23, KOSPI increased 7.77 points or 0.3% to 2,567.56 and Straits Times rose 2.66 points or 0.07% to 3,863.07, while Taiwan Weighted was down by 3.97 points or 0.02% to 20,518.62.
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