Indian Markets Gain as Talks Progress on India-EU FTA; Small-Caps Outperform

Market Update at 12:36 PM: Indian equity benchmark indices advanced on Wednesday, supported by positive sentiment around the finalisation of the India–European Union Free Trade Agreement (FTA) and upbeat global cues.

By 12:32 PM, the BSE Sensex was trading at 82,129.46, up 271.98 points or 0.33 per cent, while the NSE Nifty 50 stood at 25,274.65, higher by 99.25 points or 0.39 per cent.

In the Sensex pack, BEL, Eicher, Bajaj Finance, Power Grid and RIL were among the Top Gainers, rising by up to 3.6 per cent. On the downside, Asian Paints, Maruti Suzuki India, Infosys, Sun Pharma and HUL were trading lower, declining by up to 5 per cent.

Broader market sentiment was strong, with smallcap stocks outperforming. The Nifty Smallcap 100 index climbed 1.33 per cent, while the Nifty Midcap 100 gained 0.74 per cent.

Among sectoral indices, Nifty Oil & Gas led the rally with a jump of 3.2 per cent, followed by Nifty Metals, which rose 2.81 per cent. Other sectors such as Nifty Financial Services and Nifty Media also traded higher by over 1 per cent each. Meanwhile, Nifty FMCG, Pharma and IT indices remained in the red, moving lower during the session.

Market Update at 10:18 AM: India’s equity benchmarks opened higher on Wednesday, extending gains from the previous session after a landmark trade deal with the European Union raised expectations of an economic boost for the country.

The Nifty 50 rose 0.33 per cent to 25,258.85, while the BSE Sensex added 0.04 per cent to 81,892.36 as of 9:15 a.m. IST. This followed a 0.5 per cent rise in the Nifty 50 on Tuesday after the agreement with the EU eliminated tariffs on 90 per cent of Indian goods, significantly improving market sentiment around trade and export-linked sectors.

Market breadth remained strong with fifteen of the sixteen major sectors posting gains. Broader indices also participated in the rally, as the CNX Smallcap advanced 0.6 per cent and the CNX Midcap gained 0.4 per cent.

Global cues added support, with MSCI’s broadest index for Asia Pacific stocks outside Japan rising 1.2 per cent ahead of the U.S. Federal Reserve’s policy decision later in the day. Meanwhile, the U.S. dollar slipped to a four-year low, offering further comfort to emerging markets.

Pre-Market Update at 7:47 AM: The Indian stock market is expected to open higher on Wednesday, supported by firm global cues and optimism after the India–EU free trade agreement (FTA). Gift Nifty was trading near 25,445, reflecting a premium of about 62 points over the previous Nifty futures close, indicating a positive start for benchmark indices.

On Tuesday, domestic markets closed on a strong note after the announcement of the India–EU FTA. The Sensex gained 319.78 points, or 0.39 per cent, to finish at 81,857.48, while the Nifty 50 rose 126.75 points, or 0.51 per cent, to settle at 25,175.40. 

Asian markets traded mixed on Wednesday. Japan’s Nikkei 225 dropped 0.79 per cent and the Topix fell 0.97 per cent, while South Korea’s Kospi gained 1.27 per cent and the Kosdaq rallied 1.55 per cent to record highs. Hong Kong’s Hang Seng index futures also pointed to a stronger start.

Gift Nifty was hovering near 25,445, showing a premium of nearly 62 points from the previous Nifty futures close, suggesting a firm opening for Indian equities.

On Wall Street, the U.S. market ended mixed ahead of major megacap earnings, although the S&P 500 posted its fifth straight day of gains and touched an Intraday record high. The Dow Jones Industrial Average fell 408.99 points, or 0.83 per cent, to 49,003.41, while the S&P 500 gained 28.37 points, or 0.41 per cent, to 6,978.60. The Nasdaq Composite climbed 215.74 points, or 0.91 per cent, to 23,817.10.

Among notable stock moves, Nvidia rose 1.10 per cent, Microsoft added 2.19 per cent, Apple gained 1.12 per cent and Tesla slipped 0.99 per cent. Healthcare names saw sharp declines, with UnitedHealth plunging 19.61 per cent, Humana sliding 21.13 per cent and CVS Health losing 14.15 per cent. On the other hand, General Motors surged 8.77 per cent.

U.S. consumer confidence dropped to its lowest level in over 11 years in January. The Conference Board’s index fell 9.7 points to 84.5, the lowest since May 2014, versus expectations of 90.9, reflecting weaker sentiment around economic and personal financial conditions.

Minutes from the Bank of Japan’s December meeting indicated broad agreement among policymakers on the need to keep raising interest rates. Some members noted the influence of a weaker yen on underlying inflation and discussed the timing of the next rate hike.

Gold prices hit fresh record highs amid growing economic and geopolitical uncertainty. Spot gold traded at USD 5,186.08 per ounce after touching a record USD 5,202.06. U.S. gold futures rose 2.01 per cent to USD 5,223.34. Spot silver prices were also higher, up 1.14 per cent at USD 113.41 per ounce.

Crude oil prices were flat to muted. Brent crude slipped 0.12 per cent to USD 67.49 a barrel, while U.S. West Texas Intermediate (WTI) futures inched up 0.08 per cent to USD 62.39 per barrel.

There are no stocks banned for trading in the F&O segment today.

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