Key gauges remain in green in morning deals

Indian equity benchmarks continued to trade higher in morning deals, led by gains in Utilities, Power and Metal stocks. Traders took support with Finance Minister Nirmala Sitharaman’s statement that India is looking for a good trade agreement with the US to promote economic growth and ensure smooth supply chains. However, gains remain capped as some concern came with the Global Trade Research Initiative’s (GTRI) economic think tank stating that the European Union's (EU) aggressive environmental regulations, particularly the carbon tax, deforestation rules, and supply chain due diligence laws are one of the biggest hurdles in the negotiations for a proposed trade pact with India. Sector-wise, stocks related to Shipping sector remained in watch as Shipping Minister Sarbananda Sonowal reviewed undergoing projects of the ports ministry worth $2 trillion, and set a target, after consulting with experts, to complete at least 150 projects by September 2025. On the global front, Asian markets are trading mostly in red as uncertainty over tariff negotiations and geopolitical tensions kept investors on edge. 

The BSE Sensex is currently trading at 74601.27, up by 268.69 points or 0.36% after trading in a range of 74156.00 and 74741.25. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green and red; the BSE Mid cap index was up by 0.06%, while Small cap index down by 0.57%.

The top gaining sectoral indices on the BSE were Utilities up by 1.51%, Power up by 1.08%, Metal up by 0.95%, Telecom up by 0.84% and FMCG up by 0.77%, while Industrials down by 0.62%, Capital Goods down by 0.49%, Consumer Durables down by 0.34%, Consumer Discretionary down by 0.34% and Auto down by 0.20% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 3.53%, Hindustan Unilever up by 1.74%, Bajaj Finserv up by 1.69%, Bajaj Finance up by 1.59% and Adani Ports &SEZ up by 1.57%. On the flip side, Indusind Bank down by 3.07%, Zomato down by 1.31%, Larsen & Toubro down by 1.10%, Titan Company down by 0.76% and Mahindra & Mahindra down by 0.37% were the top losers.

Meanwhile, the Global Trade Research Initiative (GTRI) in its report has said that the European Union's (EU) aggressive environmental regulations, particularly the carbon tax, deforestation rules, and supply chain due diligence laws are one of the biggest hurdles in the negotiations for a proposed trade pact with India. It added that these regulations could impose additional costs on Indian exports. GTRI indicated that Indian exports of steel, aluminum and cement to the EU could face tariffs of 20 to 35 per cent under the Carbon Border Adjustment Mechanism (CBAM). It added that such scenario raises concerns that while EU goods would enter India duty-free, Indian exports would still face these indirect barriers in Europe. GTRI Founder Ajay Srivastava has said that India is pressing for clear exemptions or compensatory measures within the FTA to neutralize the impact of CBAM and related environmental rules.

Talking about service sector, the report said that the EU's restrictions on remote online service delivery (Mode 1) undermines the very purpose of digital trade, making it more difficult for Indian IT firms to offer their services remotely as Indian companies are required to establish local offices and maintain high minimum salary thresholds for Indian professionals working in Europe. It added that long-standing demand from India is for the EU to recognize it as a 'data secure country' under the General Data Protection Regulation (GDPR) cause without this status, Indian companies handling EU citizens' data face additional compliance costs and legal barriers, unlike firms from countries like Japan or South Korea, which enjoy seamless data transfers. GTRI added that European firms are seeking greater access to India's banking, legal, accountancy, auditing, and financial services sectors, while India is seeking the recognition of professional qualifications through Mutual Recognition Agreements (MRAs) which would allow Indian professionals in areas like medicine, engineering, and accountancy to work more easily in EU countries.

On bilateral investment between the both parties, GTRI has said that while India has proposed its Model Bilateral Investment Treaty (BIT) as the framework, the EU wants India to relax its investment protection clauses to align with European expectations. Further, EU wants stronger enforcement mechanisms, extended data exclusivity for pharmaceutical companies, tougher patent protection rules and also insisting India to align its labor laws with international standards, particularly in areas like collective bargaining, workplace safety, and wages. The India-EU agreement has the potential to significantly boost trade and investment between the two partners. The EU, with a GDP of $18.4 trillion and a population of 448 million, is a major global trade player, exporting over $2.9 trillion and importing more than $2.6 trillion annually. India, with a $3.9 trillion economy and a population of 1.4 billion, exported $437 billion in goods and imported $678 billion in FY'2024.

The CNX Nifty is currently trading at 22631.20, up by 78.70 points or 0.35% after trading in a range of 22498.65 and 22676.75. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Power Grid Corporation up by 3.46%, JSW Steel up by 1.85%, Bajaj Finserv up by 1.83%, Hindustan Unilever up by 1.81% and Bajaj Finance up by 1.65%. On the flip side, Indusind Bank down by 3.05%, Trent down by 2.32%, Bajaj Auto down by 1.47%, Larsen & Toubro down by 1.01% and Hero MotoCorp down by 0.70% were the top losers.

Asian markets are trading mostly in red; Taiwan Weighted lost 54.97 points or 0.24% to 22,521.10, Hang Seng declined 511.04 points or 2.15% to 23,720.26, Straits Times fell 6.4 points or 0.16% to 3,908.08, Jakarta Composite plunged 37.59 points or 0.57% to 6,598.41 and Shanghai Composite weakened 19.96 points or 0.6% to 3,352.59.

On the flip side, Nikkei 225 surged 71.16 points or 0.19% to 36,958.33 and KOSPI increased 11.24 points or 0.44% to 2,574.72.