Indian equities are anticipated to open higher on Wednesday, buoyed by positive trends from global markets. However, market volatility may persist due to concerns regarding Trump's tariff policies, disappointing corporate earnings, and continued outflows from foreign funds.
Today, significant attention will be on the quarterly earnings reports of leading firms such as HDFC Bank and Hindustan Unilever Limited (HUL). On the previous trading day, the Sensex and Nifty indices witnessed declines of 1.6% and 1.4%, respectively, amidst uncertainty linked to Trump's tariff intentions. The rupee depreciated by 14 paise, settling at 86.59 against the US dollar.
According to preliminary data, foreign institutional investors (FIIs) executed net sales of shares valued at Rs 5,920.28 crore on Tuesday, whereas domestic institutional investors (DIIs) made net purchases amounting to Rs 3,500.32 crore.
In the Asian markets, performance was mixed. Japan's Nikkei saw a rally of 1.5%, driven by tech stocks in the wake of Netflix Inc.'s record-breaking quarterly subscriber gains and Trump's announcement of a new investment initiative focused on artificial intelligence. The Japanese yen experienced a slight appreciation amid expectations for a potential interest rate hike by the Bank of Japan (BoJ) this week.
Conversely, benchmarks in mainland China and Hong Kong fell by over 1%, following Trump's declaration of a potential 10% tariff on China beginning February 1, along with threats to impose tariffs on the European Union.
In currency trade, the US dollar softened during Asian sessions, while US Treasury yields made modest gains after a previous decline. Gold maintained its position near an 11-week high, reflecting uncertainties tied to Trump's trade policy.
Oil prices continued to weaken as Trump's energy emergency order amplified oversupply concerns.
In the US, stock markets closed on a strong note overnight, driven by a dip in bond yields amid optimism for rate cuts and less aggressive-than-expected tariff policies articulated on Trump's Inauguration Day. The Dow Jones Industrial Average rose by 1.2%, the S&P 500 increased by 0.9%, and the tech-centric Nasdaq Composite advanced by 0.6%.
Meanwhile, European stocks ended Tuesday on a higher trajectory, steered by gains in financial and healthcare sectors. The pan-European STOXX 600 index inched up by 0.4%, with Germany's DAX rising 0.3%, France's CAC 40 climbing by 0.5%, and the UK's FTSE 100 advancing 0.3%.
