Key gauges trade lower in morning deals

Indian equity benchmarks continued to trade lower in morning deals, led by a decline in Capital Goods, Industrials and Power stocks, tracking weak cues from Asian markets. Traders remained cautious as exchange data showed Foreign institutional investors (FIIs) offloaded equities worth Rs 1,327.09 crore in the capital markets on a net basis on Saturday. Traders overlooked private survey showed India's factory activity started 2025 on a positive note, growing at the quickest pace in six months in January largely buoyed by resilient demand and strong output. The HSBC final India Manufacturing Purchasing Managers' Index, compiled by S&P Global, rose to 57.7 last month from December's 12-month low of 56.4. It was a tad below an early estimate that showed a rise to 58.0. On the global front, Asian markets are trading lower after news the US tariffs were put in place over the weekend, which led to concerns about higher inflation that will force the US Fed to put a hold on interest rate cuts for longer. 

The BSE Sensex is currently trading at 77049.95, down by 456.01 points or 0.59% after trading in a range of 76756.09 and 77128.57. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 1.14%, while Small cap index was down by 1.72%.

The lone gaining sectoral index on the BSE was Consumer Durables up by 1.07%, while Capital Goods down by 4.42%, Industrials down by 3.85%, Power down by 3.74%, Utilities down by 3.16% and PSU down by 3.09% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finserv up by 2.13%, Bajaj Finance up by 2.10%, Titan Company up by 1.87%, Maruti Suzuki up by 1.81% and Bharti Airtel up by 1.30%. On the flip side, Larsen & Toubro down by 4.19%, NTPC down by 3.57%, Power Grid Corporation down by 2.85%, Tata Steel down by 2.14% and Tata Motors down by 2.03% were the top losers.

Meanwhile, the Global Trade Research Initiative (GTRI) said the customs duty reduction announced in the Budget on products such as motorcycles and synthetic flavouring essences would benefit American exports. It said that despite the repeated criticism of India as the biggest tariff abuser and tariff king by the Trump-administration, the country's Budget has introduced significant tariff reductions on multiple products, many of which benefit the US exports. 

GTRI said with key tariff cuts on technology, automobiles, industrial inputs, and waste imports, India appears to be taking steps toward facilitating trade even as the global trade environment remains tense. It said whether these reductions will alter Washington's view of India's trade practices or become a point of contention in the US election cycle remains to be seen. Among the key tariff reductions, India lowered the duty on fish hydrolysate for the manufacturing of aquatic feed from 15 per cent to 5 per cent, a move that directly impacts US exports, which amounted to $35 million in 2023-24. 

For the automobile sector, it said India has reduced tariffs on motorcycles based on engine capacity. For motorcycles with an engine capacity below 1,600cc, the tariff has been cut from 50 per cent to 40 per cent, while for motorcycles above 1,600cc, the tariff has been slashed from 50 per cent to 30 per cent. The US motorcycle exports to India stood at $3 million in FY24, and this tariff cut could help expand market access for American manufacturers. Similarly, it said, tariff cut on ethernet switches (carrier-grade) under the others category from 20 per cent to 10 per cent would help American exporters. India has also lowered the duties on synthetic flavouring essences from 100 per cent to 20 per cent, a category in which Washington exports stood at $21 million in FY24.  

The CNX Nifty is currently trading at 23309.70, down by 172.45 points or 0.73% after trading in a range of 23222.00 and 23345.15. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were Bajaj Finance up by 2.16%, Bajaj Finserv up by 2.08%, Eicher Motors up by 2.02%, Titan Company up by 1.89% and Maruti Suzuki up by 1.87%. On the flip side, Bharat Electronics down by 4.86%, Larsen & Toubro down by 4.28%, BPCL down by 3.85%, NTPC down by 3.54% and ONGC down by 3.42% were the top losers.

All Asian markets are trading lower; Nikkei 225 slipped 1081.28 points or 2.73% to 38,491.21, Taiwan Weighted lost 830.9 points or 3.53% to 22,694.51, Hang Seng declined 149.16 points or 0.74% to 20,075.95, KOSPI dropped 68.23 points or 2.71% to 2,449.14, Straits Times fell 16.6 points or 0.43% to 3,839.22 and Jakarta Composite plunged 161.43 points or 2.27% to 6,947.77.