Nifty & Sensex Likely to Open Lower as U.S. Tariff Concerns Weigh on Sentiment

Pre-Market Update at 7:45 AM: Indian stock markets are expected to begin Tuesday, July 8, on a softer note, as global sentiment turns cautious following the United States' announcement of steep import tariffs. President Donald Trump has declared new tariffs ranging between 25 per cent and 40 per cent on several countries, including Japan and South Korea, which are set to take effect from August 1. This announcement has added pressure to global markets, even as Asian indices show early signs of resilience.

 As of 7:15 AM, the GIFT Nifty was quoting near 25,506, about 10 points lower than its previous close, indicating a weak start for domestic equities.

Despite overnight losses on Wall Street, Asian markets opened marginally higher, suggesting that investors are still optimistic about the possibility of continued trade negotiations. This week, the Indian market is likely to react to multiple cues including the first-quarter earnings season, the expected U.S.-India trade discussions, minutes from the latest Federal Reserve meeting, and key global economic data.

Foreign Institutional Investors (FIIs) were net buyers on Monday, July 7, investing Rs 1,853.39 crore in Indian equities. Domestic Institutional Investors (DIIs) also extended support, buying shares worth Rs 321.16 crore. This institutional activity helped stabilise the market during a session marked by global uncertainty.

On Monday, the Nifty 50 closed almost flat at 25,461.3, while the BSE Sensex edged up by 0.01 per cent to end at 83,442.5. Consumer-focused stocks provided some support, helping offset losses in other sectors. However, the broader markets underperformed, with the Nifty Midcap index falling 0.3 per cent and the Smallcap index down 0.4 per cent, as investors remained cautious due to escalating trade tensions.

U.S. markets closed significantly lower on Monday following U.S. President Trump's announcement of steep tariffs targeting major trade partners. The Dow Jones Industrial Average slipped by 422.17 points, a drop of 0.94 per cent, settling at 44,406.36. The S&P 500 also moved down, losing 49.37 points or 0.79 per cent, to finish at 6,229.98. Meanwhile, the Nasdaq Composite declined by 188.59 points, or 0.91 per cent, ending the session at 20,412.52.

Meanwhile, gold prices held steady as investors sought safety amid geopolitical tensions. However, rising U.S. Treasury yields capped any major upside. Spot gold was trading 0.1 per cent lower at USD 3,336.39 per ounce. Oil prices, after rising nearly 2 per cent in the previous session, saw some correction. Brent crude futures fell 0.30 per cent to USD 69.37 a barrel, while U.S. West Texas Intermediate (WTI) crude dropped 0.35 per cent to USD 67.69 per barrel. The decline was attributed to concerns over increased OPEC+ supply and the broader impact of new U.S. trade measures.

The Indian rupee weakened significantly on Monday, depreciating by 54 paise to close at Rs 85.94 against the U.S. dollar. The fall was driven by rising crude oil prices and continued strength in the dollar globally, adding further pressure on domestic currency markets.

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Disclaimer: The article is for informational purposes only and not investment advice.