14 Jul 2025

Indian Markets May Open Lower Amid Global Uncertainty; Key Economic Indicators in Focus

Indian equity markets are expected to begin Monday’s session on a negative note, tracking mixed global cues and renewed concerns over U.S. President Donald Trump’s escalating trade tensions. Traders may remain cautious ahead of India’s June Wholesale Price Index (WPI) data and HCL Technologies’ Q1 earnings. Sentiments are also likely to be weighed down by foreign fund outflows as Foreign Institutional Investors (FIIs) continue to remain net sellers.

Key Factors to Watch:

  • Forex Reserves Dip by $3 Billion: The Reserve Bank of India reported that India’s forex reserves fell by $3.04 billion to $699.73 billion in the week ending July 4, 2025.

  • Net Direct Tax Collections Decline: Government data showed net direct tax mop-up dipped 1.34% to RS 5.63 lakh crore till July 10 of FY26, largely due to higher refunds.

  • Income Tax Refunds Surge: A private report highlighted that income tax refunds have risen 474% since 2013-14, reaching RS 4.77 lakh crore in 2024-25, outpacing the 274% growth in gross tax collections.

  • Switzerland Ratifies India-EFTA Mega Trade Pact: Switzerland has completed ratification for a landmark trade deal between India and the European Free Trade Association (EFTA), which is expected to reduce trade barriers and boost Swiss exports to India.

  • Progress in India-Singapore Relations: External Affairs Minister S Jaishankar noted steady progress in bilateral ties with Singapore during a meeting with Deputy Prime Minister Gan Kim Yong.

Global Market Overview:
U.S. markets closed in the red on Friday as trade tensions escalated under President Trump’s administration. Meanwhile, Asian markets were trading mostly in green on Monday following the release of Chinese trade data.

Indian Market Recap:
On Friday, Indian equity benchmarks fell for a third consecutive session amid a weak start to the Q1 earnings season and concerns over the U.S. imposing a 35% tariff on Canada. The BSE Sensex dropped 689.81 points or 0.83% to close at 82,500.47, while the CNX Nifty slipped 205.40 points or 0.81% to settle at 25,149.85.

Other Key Developments:

  • ARC AUM May Decline by 6% in FY26: Ratings agency Crisil projected that private asset reconstruction companies’ assets under management (AUM) could fall by up to 6% in FY26 to RS 1.05 lakh crore as redemptions outpace acquisitions.

  • India Revises Retaliatory Duties Against US: Amid rising U.S. tariffs on steel and aluminium, India has revised its proposed retaliatory duties under WTO norms.

  • India Eyes Japan’s Garment Market: The Apparel Export Promotion Council (AEPC) stated that India is poised to fill the gap left by China’s declining share in Japan’s garment imports.