Markets Show Cautious Gains in Early Trade
Indian equities opened in the green on Friday but showed signs of volatility soon after the session began. The BSE Sensex started the day near 80,150, gaining over 50 points, while the NSE Nifty50 opened just above 24,500, up 11 points.
Within minutes of trading, both benchmarks climbed but quickly pared gains, reflecting the uncertain mood on Dalal Street. At 9:07 a.m., the GIFT Nifty slipped 44 points to test 24,650. Meanwhile, the Sensex was down 57 points, hovering near the 80,000 mark, while the Nifty traded nearly flat.
On the Sensex, HUL, Asian Paints, ITC, Kotak Bank, and Trent emerged as top gainers. In contrast, M&M, NTPC, Titan, Infosys, and Eternal dragged the index lower.
US Tariffs Cast Shadow on Investor Confidence
Investor sentiment remains fragile following Washington’s decision to implement an additional 25% levy on Indian goods, taking the overall tariff burden to 50%. The move, linked to India’s continued imports of Russian oil, has heightened trade tensions and rattled exporters.
Market analysts say the sharp increase in duties has clouded near-term prospects for India’s external trade and corporate earnings. As a result, traders remain cautious despite early gains in equities.
Previous Session’s Market Performance
On Thursday, Indian indices ended sharply lower amid weak global cues and sustained foreign fund outflows. The Sensex dropped 705.97 points (0.87%) to close at 80,080.57, after touching an intraday low of 80,013.02. The Nifty slipped 211.15 points (0.85%) to settle at 24,500.90.
“Domestic equities ended lower as pessimism deepened following the implementation of tariffs on Indian goods,” said Vinod Nair, Head of Research, Geojit Investments. He added that while the government’s cotton import duty exemption briefly lifted hopes, overall sentiment stayed weak with large-cap, mid-cap, and small-cap stocks under pressure.
Government Response to Cushion Exporters
In a move to provide relief, the government extended duty-free cotton imports until December 31. The measure is expected to help textile exporters struggling with higher tariff burdens in the US.
Analysts say the step could soften the blow for the textile sector, but challenges persist across industries such as engineering, pharmaceuticals, and chemicals that remain exposed to American trade restrictions.
Broader Market Outlook
Market experts note that volatility will likely continue as traders digest global cues, including the US tariff escalation and sustained risk-off sentiment worldwide. With global equities also under pressure, Indian markets may struggle to maintain upward momentum in the near term.
Additionally, foreign portfolio investors have been pulling funds out of Indian equities, further adding to pressure on large-cap and mid-cap indices. Analysts expect traders to remain cautious, focusing on macroeconomic developments and potential government interventions to support exporters.
What Lies Ahead
The immediate focus for investors remains on global trade developments and domestic policy measures. If volatility persists, sectors reliant on exports may face extended headwinds, while defensive plays like FMCG and banking could attract investor interest.
Market watchers believe that sustained recovery will depend on easing trade tensions, supportive government policies, and signs of stability in global risk appetite.