Markets trim opening losses to trade flat with positive bias in early deals

Indian equity benchmarks made a negative start on Tuesday tracking weakness in Asian counterparts and mixed cues from Wall Street overnight, as traders remained cautious ahead of the U.S. interest rate decision later in the week and as they awaited the outcome of the U.S.-China trade talks. Besides, several European leaders voiced concerns over the EU-U.S. trade deal, calling it 'lopsided' and 'unsustainable'. However, soon markets trimmed their losses and are trading flat with positive bias in early deals on account of value buying after previous session’s sell-off. Some support came as the finance ministry said that despite concerns over slowing credit growth, Indian economy has the look and feel of 'steady as she goes' for the current fiscal. 

However, market participants remained cautious amid delays in the U.S. interim trade deal, sustained foreign fund outflows, and disappointing corporate earnings. Foreign Institutional Investors (FIIs) continued their selling streak for the sixth day, FIIs sold equities worth Rs 6,082 crore on July 28. Traders were also concerned as the government data showed that India's industrial production growth slowed to a 10-month low of 1.5 per cent in June 2025 due to poor performance of mining and power sectors, which were impacted by excess rains especially in second half of the month.

The BSE Sensex is currently trading at 80940.83, up by 49.81 points or 0.06% after trading in a range of 80575.45 and 80962.85. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.30%, while Small cap index was up by 0.17%.

The top gaining sectoral indices on the BSE were Realty up by 1.33%, Basic Materials up by 0.54%, Metal up by 0.51%, Energy up by 0.49% and Oil & Gas up by 0.43%, while Capital Goods down by 0.26%, IT down by 0.20%, Utilities down by 0.20%, Power down by 0.15% and Consumer Durables down by 0.13% were the top losing indices on BSE.

The top gainers on the Sensex were Trent up by 0.92%, Reliance Industries up by 0.84%, Tata Motors up by 0.75%, Sun Pharma up by 0.63% and Bharti Airtel up by 0.51%. On the flip side, Eternal down by 2.07%, Bharat Electronics down by 0.95%, NTPC down by 0.69%, TCS down by 0.55% and Infosys down by 0.45% were the top losers.

Meanwhile, the finance ministry in its monthly economic review has said that Indian economy has the look and feel of ‘steady as she goes’ for the current fiscal, even as it flagged slowing credit growth. It said the first quarter of fiscal 2025-26 (FY26) presents a picture of resilient domestic supply and demand fundamentals. With inflation remaining within the target range and monsoon progress on track, the domestic economy enters the second quarter of FY26 on a relatively firm footing. While geopolitical tensions have not elevated further, the global slowdown, particularly in the US (which shrank by 0.5 per cent in Q1 2025), could dampen further demand for Indian exports.

It also said ‘Continued uncertainty on the US tariff front may weigh on India’s trade performance in the coming quarters. Slow credit growth and private investment appetite may restrict acceleration in economic momentum’. Further, given the deflationary trend in the wholesale price index, one has to observe economic momentum in nominal quantities. Measured in constant prices, economic activity may appear healthier than it is. It said ‘All that said, the economy has the look and feel of ‘steady as she goes’ as far as FY26 is concerned’.

The monthly economic review noted despite monetary easing and a strong bank balance sheet, credit growth has slowed, reflecting cautious borrower sentiment and possibly risk-averse lender behaviour. It said ‘A growing preference for bond markets, particularly commercial papers among corporates due to lower borrowing costs, may also explain the shift’. Piggybacking on initiatives like the Employment Linked Incentive (ELI) scheme, the ministry said it is time for corporates to set the ball in motion. The Reserve Bank has cumulatively reduced the short-term lending rate (repo) by 100 basis points since February.

With an outlay of Rs 99,446 crore, the ELI scheme aims to incentivise the creation of more than 3.5 crore jobs in the country over a period of 2 years, with special focus on the manufacturing sector. It said that despite global headwinds marked by trade tensions, geopolitical volatility, and external uncertainties, India’s macroeconomic fundamentals have remained resilient. The report said high-frequency indicators reflected broad-based strength, registering strong year-on-year growth. While the manufacturing and construction sectors continued to expand, the services sector anchored the overall economic growth in Q1 of FY26.

The CNX Nifty is currently trading at 24688.15, up by 7.25 points or 0.03% after trading in a range of 24598.60 and 24712.60. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were JIO Financial Services up by 1.85%, JSW Steel up by 1.48%, Trent up by 1.05%, Tata Consumer Products up by 1.00% and Shriram Finance up by 0.96%. On the flip side, Eternal down by 2.13%, SBI Life Insurance down by 0.93%, Bharat Electronics down by 0.91%, NTPC down by 0.69% and Wipro down by 0.56% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 365.27 points or 0.89% to 40,633.00, Hang Seng declined 275.13 points or 1.09% to 25,287.00, Taiwan Weighted lost 238.98 points or 1.03% to 23,174.00, Straits Times fell 16.3 points or 0.38% to 4,224.84 and Shanghai Composite was down by 2.75 points or 0.08% to 3,595.19. On the other hand, KOSPI increased 19.79 points or 0.61% to 3,229.31 and Jakarta Composite was up by 3.28 points or 0.04% to 7,618.05.