Key gauges remain in red in morning deals

Indian equity benchmarks remained in red in morning deals, as fresh tariff threats, weak Asian markets and foreign fund outflows hurt investors' sentiment. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,881.30 crore on Wednesday after a day's breather, according to exchange data. Traders took a note of RBI Bulletin stated that high frequency indicators, like vehicles sales, air traffic, steel consumption and GST E-way bills, point towards a sequential pickup in momentum of economic activity during the second half of the fiscal 2024-25 and sustain moving forward. However, it said a strong dollar, driven by US economic resilience and trade policy pivots, could exacerbate capital outflows from emerging economies, push risk premiums higher, and intensify external vulnerabilities. On the global front, Asian markets are trading lower as tariff worries persisted, and the Fed's January policy meeting minutes revealed policymakers are inclined to hold interest rates steady amid stubborn inflation and economic-policy uncertainty.

The BSE Sensex is currently trading at 75704.65, down by 234.53 points or 0.31% after trading in a range of 75463.01 and 75741.17. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.48%, while Small cap index was up by 0.80%.

The top gaining sectoral indices on the BSE were Metal up by 0.98%, Oil & Gas up by 0.79%, PSU up by 0.79%, Industrials up by 0.74% and Power up by 0.74%, while Bankex down by 0.51%, FMCG down by 0.41%, Consumer Durables down by 0.16% and Realty down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 2.10%, Infosys up by 0.97%, NTPC up by 0.79%, Reliance Industries up by 0.73% and Adani Ports &SEZ up by 0.68%. On the flip side, Maruti Suzuki down by 2.23%, HDFC Bank down by 2.03%, ITC down by 1.17%, Zomato down by 0.75% and Bharti Airtel down by 0.70% were the top losers.

Meanwhile, the Global Trade Research Initiative (GTRI) has said that India should cautiously evaluate the potential free trade agreement (FTA) with Qatar, particularly in the petrochemical sector as both countries are strong in this segment. India should ensure that tariff concessions on petrochemicals and energy-related imports do not undermine domestic industries. As per the joint statement issued after the meeting of Prime Minister Narendra Modi and Amir of Qatar Sheikh Tamim bin Hamad Al-Thani, the two sides agreed to explore the possibility of entering into a bilateral comprehensive economic partnership agreement (CEPA) with an aim to double bilateral trade to $28 billion by 2030. CEPA is a kind of FTA in which two trading partners either eliminate or significantly reduce customs duties on the maximum number of goods (90% to 95%) traded between them. In addition, they ease norms to promote trade in services and boost investments.

GTRI founder Ajay Srivastava has said that India has a well-developed domestic petrochemical industry that could face challenges if tariff reductions lead to an influx of cheaper Qatari imports, additionally India already has a significant trade deficit with Qatar, which could widen further post-trade pact if market access benefits are not balanced. The Indian imports from Qatar stood at $12.34 billion in 2023-24, with 85% of imports comprising LNG ($6.3 billion), butane, propane mostly for LPG production ($3.1 billion), and petroleum crude ($1.1 billion). Its exports were only $1.7 billion. Meanwhile, India's primary exports to Qatar include Basmati rice ($124 million), articles of iron and steel ($200 million), and machinery ($106 million).

In 2023-24, the bilateral trade between both the countries has declined to $14 billion from $18.77 billion in 2022-23. India received $1.5 billion of foreign direct investments from that country between April 2000 and September 2024. Qatar is a member of the Gulf Cooperation Council (GCC). GCC has six member countries -- Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE). India already has an FTA with the UAE. It is also in the advanced stage to conclude talks for a similar pact with Oman.

The CNX Nifty is currently trading at 22885.95, down by 46.95 points or 0.20% after trading in a range of 22812.75 and 22909.75. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Shriram Finance up by 2.24%, Mahindra & Mahindra up by 2.00%, Hindalco up by 1.75%, Cipla up by 1.10% and Bajaj Auto up by 1.09%. On the flip side, Maruti Suzuki down by 2.33%, HDFC Bank down by 2.02%, ITC down by 1.21%, Tata Consumer Product down by 0.80% and Bharti Airtel down by 0.71% were the top losers.

All Asian markets are trading lower; Nikkei 225 slipped 525.58 points or 1.34% to 38,639.03, Taiwan Weighted lost 54.23 points or 0.23% to 23,549.85, Hang Seng declined 316.73 points or 1.4% to 22,627.51, KOSPI dropped 16.24 points or 0.61% to 2,655.28, Straits Times fell 3.02 points or 0.08% to 3,931.02, Jakarta Composite plunged 19.29 points or 0.28% to 6,775.58 and Shanghai Composite weakened 5.45 points or 0.16% to 3,346.09.