The domestic equity benchmarks ended with moderate losses today, pressured by intensified selling in IT stocks following disappointing earnings from major IT companies, which dampened investor sentiment on Dalal Street. The Nifty settled below 25,100 level.
Global cues further dragged sentiment. The White House’s announcement that U.S. President Donald Trump will visit the Federal Reserve on Thursday — an unexpected move — has intensified tensions with Fed Chair Jerome Powell, creating uncertainty in global markets.
Adding to the pessimism, there was no progress on the interim trade deal between India and the U.S. ahead of Washington’s 1 August deadline. According to media reports, negotiations between the countries have stalled over tariff reductions on key agricultural and dairy products.
The barometer index, the S&P BSE Sensex slumped 542.47 points or 0.66% to 82,184.17, while the Nifty 50 fell 157.80 points or 0.63% to 25,062.10.
In the broader market, the S&P BSE Mid-Cap index declined 0.43%, and the S&P BSE Small-Cap index was down 0.50%. Market breadth was weak on the BSE.
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, added 1.97% to 10.72.
Among the sectoral indices, the Nifty PSU Bank index (up 1.24%), the Nifty Healthcare index (up 0.65%) and the Nifty Pharma index (up 0.55%) outperformed the Nifty 50 index.
Meanwhile, the IT index (down 2.21%), the Nifty FMCG index (down 1.12%) and the Realty index (down 1.04%) the underperformed the Nifty 50 index.
Economy:
The HSBC India Manufacturing PMI climbed to 59.2 in July 2025 from 58.4 in the previous month, according to preliminary estimates. The latest figure signaled a robust expansion in manufacturing activity and marked the highest reading in nearly 17-and-a-half years, highlighting the sector's continued momentum.
The HSBC India Services PMI declined to 59.4 in July 2025 from 60.4 in the previous month, preliminary readings showed. The latest figure marked a slowdown from the fastest expansion in ten months, as output growth eased compared to the prior month.
The HSBC India Composite PMI fell to 60.7 in July 2025 from a final 61.0 in June, which was a 14-month high, flash data showed. Despite the slight dip, the latest result remained well above its long-run average of 54.8. Services activity rose at a slightly slower pace, though still robust by historical standards, while manufacturing output grew the most since April 2024.
India-UK Deal
India and the UK signed a landmark Free Trade Agreement on Thursday, aiming to boost annual bilateral trade by $34 billion. Under the agreement, India will reduce tariffs on 90% of goods imported from the UK, while the UK will eliminate duties on 99% of Indian exports. The pact is expected to benefit key sectors such as leather, textiles, electronics, and software, while also attracting fresh investments between the two nations.
Numbers to Track:
The yield on India's 10-year benchmark federal paper rose 0.25% to 6.328 from the previous close of 6.312.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 86.4200 compared with its close of 86.4125 during the previous trading session.
MCX Gold futures for 5 August 2025 settlement declined 0.82% to Rs 98,600.
The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.17% to 97.39.
The United States 10-year bond yield rose 0.41% to 4.407.
In the commodities market, Brent crude for September 2025 settlement gained 70 cents or 1.02% to $69.21 a barrel.
Global Markets:
The US Dow Jones index futures are currently down by 130 points, indicating a negative start for US stocks today.
Most European shares advanced while Asian stocks ended higher on Thursday as fresh trade developments between the U.S. and Japan, alongside encouraging signals of a deal with the European Union, buoyed investor sentiment.
Investor focus shifted to Washington’s evolving trade strategy, with U.S. President Donald Trump setting his sights on the European Union after finalizing a sweeping agreement with Japan. Negotiators from both the U.S. and EU are now under pressure to strike a deal by August 1, as the Trump administration appears firm on its tariff timeline.
On Tuesday, the U.S. and Japan sealed what Trump described as "the largest trade deal in history." The agreement includes a $550 billion investment from Japan into the U.S. economy. In return, tariffs on Japanese exports to the American market—ranging from automobiles to agricultural goods—have been reduced to 15% from the previously proposed 25%. Trump hailed the deal as a mutually beneficial win that opens Japan’s markets to U.S. cars, trucks, and farm products.
Economic data from Japan, however, painted a mixed picture. The au Jibun manufacturing PMI dropped to 48.8 in July’s preliminary reading, below expectations of 50.2 and down from 50.1 in June, signaling a mild contraction. On the other hand, the services sector showed resilience, with the services PMI rising to 53.5 from 51.7 a month earlier.
Overnight on Wall Street, U.S. equities finished higher after Trump promoted his trade accomplishments with Japan and Indonesia on Truth Social. He also hinted at easing tariffs if other nations opened their markets to American goods. Adding to the momentum, Washington unveiled its new ‘AI Action (WA: ACT) Plan.’
The Dow Jones Industrial Average jumped 1.14% to a six-month high, while the S&P 500 gained 0.78% and the Nasdaq Composite added 0.61%.