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Markets witness consolidation as tariff fears temper Q3 earnings optimism
Jan-16-2026

Markets witnessed consolidation during the passing week as optimism over better-than-expected Q3 numbers from big companies like Infosys was offset by tariff-related uncertainties and unrelenting foreign fund outflows. Rising retail and wholesale inflation also weighed on sentiments. However, traders took note of India’s trade deal progress with US, EU and Canada.

Some of the major developments during the week are:

Retail inflation rises to 1.33% in December: India's retail inflation, as measured by the Consumer Price Index (CPI), rose by 62 basis points to 1.33% (Provisional) in the month of December 2025, as compared to 0.71% in November 2025. Earlier, in December 2024, the inflation was 5.22%.

Net direct tax mop up registers 8.82% growth so far in FY26: The Income Tax Department has said that Net direct tax collection grew 8.82 per cent to over Rs 18.38 lakh crore between April 1, 2025 and January 11, 2026 period, as compared with Rs 16.89 lakh crore collected during the same period last year.

India's December WPI inflation reverses deflationary trend: Reversing the deflationary trend, India's wholesale price index (WPI) inflation turned positive in the month of December 2025. The inflation stood at 0.83% in December, compared with a contraction of 0.32% in the previous month. 

Unemployment rate in India rises marginally to 4.8% in December: Ministry of Statistics and Programme Implementation in its Periodic Labour Force Survey has showed the unemployment rate among people aged 15 and above grew marginally to 4.8% in the month of December 2025 from 4.7% in November 2025.

India sees merchandise exports growth of 1.87% in December: The commerce ministry in its latest data has showed that India’s merchandise exports rose 1.87 per cent to $38.5 billion in December 2025 as compared to $37.80 billion in December 2024, despite persistent global economic headwinds.

BSE movement for the week

The Bombay Stock Exchange (BSE) Sensex decreased 5.89 points or 0.01% to 83,570.35 during the week ended January 16, 2026. The BSE Midcap index losses 118.75 points or 0.26% to 46,186.05, while Smallcap index slipped 210.2 points or 0.42% to 49,701.91. On the sectoral front, S&P BSE Capital Goods was down by 1,630.24 points or 2.49% to 63,952.45, S&P BSE Consumer Durables was down by 1,475.94 points or 2.40% to 60,022.13 and S&P BSE Realty was down by 158.85 points or 2.33% to 6,648.18 were the top losers, while S&P BSE Metal was up by 1,654.30 points or 4.52% to 38,262.94, S&P BSE Information Technology was up by 978.79 points or 2.66% to 37,774.03, and S&P BSE PSU was up by 471.98 points or 2.30% to 20,999.49 were the top gainers on the BSE.

NSE movement for the week

The Nifty increased 11.05 points or 0.04% to 25,694.35. On the National Stock Exchange (NSE), Nifty IT was up by 1059.45 points or 2.79% to 39,086.65, Bank Nifty was up by 843.60 points or 1.42% to 60,095.15, Nifty Next 50 gained 365.70 points or 0.53% to 68,857.90 and Nifty Mid Cap 100 increased 119.65 points or 0.20% to 59,867.80.

FII transactions during the week

Foreign Institutional Investors (FIIs) were net sellers in equity segment in the week, with gross purchases of Rs 49,805.55 crore and gross sales of Rs 60,546.07 crore, leading to a net outflow of Rs 10,740.52 crore. They also stood as net sellers in the debt segment with gross purchases of Rs 9,712.98 crore against gross sales of Rs 11,801.98 crore, resulting in a net outflow of Rs 2,089.00 crore. In hybrid segment, FIIs stood as net sellers, with gross purchases of Rs 108.27 crore and gross sales of Rs 122.18 crore, leading to a net outflow of Rs 13.91 crore.

Industry and Economy

Highlighting robust domestic demand and tax reforms, the World Bank in its flagship report ‘Global Economic Prospects’ has upwardly revised India’s Gross Domestic Product (GDP) growth forecast by 0.9 percentage points to 7.2% for the current fiscal year (FY26), from its June projections of 6.3%. However, it said growth in the country is projected to slow to 6.5% in 2026-27. The projection is based on the assumption that the 50-per cent import tariffs by the US remain in place throughout the forecast horizon. It noted that India is likely to maintain the fastest growth rate among the world's largest economies. On the rupee, it said India's currency has depreciated since May amid capital outflows driven by higher US tariffs and heightened trade-related uncertainty. 

Outlook for the coming week

In the passing week, Indian markets ended flat as India's retail inflation rose by 62 basis points to 1.33% in the month of December 2025, as compared to 0.71% in November 2025.

In the coming week, market participants will be eyeing the data of RBI Market Borrowing Auctions, which scheduled to be released on January 20. HSBC Manufacturing PMI Flash, HSBC Services PMI Flash, Bank Loan Growth, Deposit Growth and Foreign Exchange Reserves data are going to be out on January 23.

Traders continue to look forward for Q3 earnings report from many companies including Havells India, Hindustan Zinc, LTIMindtree, Mastek, Dr Reddy's Laboratories, HPCL, Tata Communications, Coforge, Cyient, Cipla, Godrej Consumer Products, JSW Steel, and Kotak Mahindra Bank etc.

On the global front, investors will be eyeing macro-economic reports from world’s largest economy, United States, starting with Redbook YoY on January 21, followed by GDP Growth Rate, and Initial Jobless Claims on January 22, Fed Balance Sheet, S&P Global Composite PMI Flash, Michigan Consumer Sentiment Final, and Baker Hughes Oil Rig Count on January 23.

Top Gainers 

  • State Bank of India (SBI) up by 3.49% was the top gainer on Nifty for the week - SBI is reportedly all set to introduce service charges on online Immediate Payment Service (IMPS) transactions above Rs 25,000. The revised IMPS charges will be effective from February 15. Recently, the Bank had revised its ATM transaction charges.
  • Oil & Natural Gas Corporation (ONGC) up by 3.39% was another top gainer on Nifty for the week - ONGC traded higher along with other oil exploration & production companies amid rising crude oil prices in the global markets. The concerns surrounding protests in Iran and a possible intervention of United State have favoured global crude oil prices.

Top Losers 

  • JIO Financial Services down by 8.14% was the top loser of the week on Nifty - JIO Financial Services traded under pressure as its third quarter performance failed to match investors’ expectations. The company has reported 8.75% fall in its consolidated net profit at Rs 268.98 crore for Q3FY26 as compared to Rs 294.78 crore for the same quarter in the previous year.
  • Larsen & Toubro down by 7.23% was another top loser of the week on Nifty - Shares of Larsen & Toubro came under pressure as investors got nervous after a private reported indicated that the Kuwait might cancel an oil project tender worth $8.7 billion with the company. Meanwhile, the company has clarified that the said project was not part of the company’s order book.

Technical viewpoints

During the week, CNX Nifty touched the highest level of 25,940.60 on January 13 and lowest level of 25,473.40 on January 12. On the last trading day, the Nifty closed at 25,694.35 with weekly gain of 11.05 points or 0.04 percent. For the coming week, 25,464.97 followed by 25,235.58 are likely to be good support levels for the Nifty, while the index may face resistance at 25,932.17 and further at 26,169.98 levels.

US Market

The U.S. markets traded lower during the week amid rising geopolitical tensions around the world. Traders were keeping an eye on political unrest in Iran and the ongoing Russia-Ukraine war.

Some of the major developments during the week are:

New York manufacturing index jumps back into positive territory in January: The New York Fed said its general business conditions index jumped to a positive 7.7 in January from a negative 3.7 in December.

U.S. weekly jobless claims decrease in week ended January 10: The Labor Department said initial jobless claims fell to 198,000, a decrease of 9,000 from the previous week's revised level of 207,000.

Philly fed index unexpectedly surges into positive territory in January: The Philly Fed said its diffusion index for current general activity surged to a positive 12.6 in January from a negative 8.8 in December.

U.S. business inventories rise slightly more than expected in October: Business inventories climbed by 0.3 percent in October, matching an upwardly revised increase in September. Street had expected business inventories to rise by 0.2 percent.

Existing home sales in U.S. surge in December: Existing home sales spiked by 5.1 percent to an annual rate of 4.35 million in December after climbing by 0.7 percent to an upwardly revised rate of 4.14 million in November.

European Market

European markets remained higher during the passing week as easing geopolitical and Fed independence concerns, some positive economic data and upbeat earnings updates helped underpin sentiment.

Some of the major developments during the week are:

Eurozone trade surplus declines in November: The Eurostat reported that the trade surplus fell to EUR 9.9 billion from EUR 17.9 billion in October. In the same period last year, the surplus totaled EUR 15.4 billion.

Eurozone industrial output logs steady growth: The Eurostat reported that industrial output climbed 0.7 percent month-on-month in November, matching the pace of increase seen in October.

German economy bounces back in 2025: Gross domestic product posted an annual growth of 0.2 percent in 2025, reversing the 0.5 percent fall in 2024 and the 0.9 percent decline in 2023.

Eurozone Sentix investor confidence strongest in 6 months: The Sentix investor confidence rose more-than-expected to -1.8 in January from -6.2 in December. The score was forecast to rise moderately to -5.1.

Swiss consumer confidence rises in December: The consumer confidence index rose to -31 in December from -34 in November. The expected score was -33.0. In the corresponding month last year, the reading was also -31.0.

Asian Market

Asian markets traded in green during the passing week, amid easing geopolitical concerns about a confrontation between the U.S. and Iran. Technology stocks also aid in the surge on revived AI-driven growth optimism.

Some of the major developments during the week are:

Japan producer prices rise 0.1% in December: The Bank pf Japan said producer prices in Japan were up 0.1 percent on month in December. That was in line with expectations and down from 0.3 percent in November.

Japan M2 Money Stock rises 1.7% in December: The M2 money stock in Japan was up 1.7 percent on year in December- coming in at 1,278.6 trillion yen. That was shy of expectations for an increase of 1.9 percent.

Bank of Korea holds interest rate at 2.5%: The Bank of Korea unanimously kept its base rate unchanged at 2.5% for a fifth consecutive meeting in its first policy decision of 2026, in line with market expectations. 

China’s December exports hit record high: China’s exports rose by 6.6% y-o-y to a record peak of $357.8 billion in December 2025, surpassing expectations of 3.0% growth and accelerating from a 5.9% gain in November.

China hits record trade surplus in 2025: China posted a record $1.189 trillion trade surplus in 2025, with exports rising 5.5% while imports were flat.
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