Nifty & Sensex Likely to Open on a Muted Note as US Tariffs Threaten to Take Effect from August 1 in Absence of a Trade Deal
On Monday, July 7, the Nifty 50 and Sensex are likely to see a muted start, tracking weak cues from global markets and cautiousness following reports that tariffs will go into effect on August 1, 2025.
As of 7:18 AM, the GIFT Nifty was trading near the 25,536 mark, up 9 points from its previous close, indicating that the Indian market is likely to open on a flat note.
Asian markets traded lower, while U.S. stock futures declined amid increased uncertainty. U.S. Treasury Secretary Scott Bessent stated that tariffs will revert to April 2 levels on August 1 if countries around the world do not reach deals with the U.S.
In the days ahead, market participants will keep an eye on crucial developments such as the anticipated U.S.-India trade agreement, first-quarter earnings, minutes from the latest U.S. Federal Reserve meeting, and important macroeconomic indicators — all of which could shape the near-term direction of Indian equities.
India has clearly outlined its non-negotiable positions on sensitive areas like agriculture and dairy in ongoing discussions for a potential interim trade deal with the United States. If both sides manage to resolve the key sticking points, the agreement could be finalised and announced before July 9. This date is significant as it marks the end of the 90-day suspension period for the Trump-era tariffs that were paused on April 2 for several countries, including India.
On Friday, July 4, Foreign Institutional Investors (FIIs) were net sellers, having sold equities worth ₹760.11 crore. Domestic Institutional Investors (DIIs), on the other hand, sold shares totalling ₹1,028.84 crore during the same session.
The Indian stock market closed slightly lower for the week ending July 4, breaking a two-week winning streak. The decline was mainly driven by profit booking, ongoing uncertainty surrounding the India-US trade agreement, and continued foreign fund outflows.
Despite these pressures, the BSE Sensex managed a modest gain of 193.41 points (0.2%) to settle at 83,432.88, while the NSE Nifty 50 added 55.70 points (0.2%) to end at 25,461. However, on a weekly basis, both indices recorded a decline of 0.70%.
Asian markets mostly traded lower on Monday morning.
U.S. stock markets remained closed on Friday due to the Independence Day holiday. Meanwhile, stock futures edged lower in early trade, with Dow Jones Industrial Average futures slipping 0.32%, S&P 500 futures down 0.39%, and Nasdaq 100 futures declining by 0.42%. Over the past week, however, the major indices posted solid gains—S&P 500 advanced 1.72%, Nasdaq rose 1.62%, and the Dow Jones climbed 2.3%.
U.S. President Donald Trump, along with key Cabinet members, has clarified that the newly announced tariffs will take effect starting August 1, not July 9 as previously anticipated. Treasury Secretary Scott Bessent noted that these tariffs, originally announced in April, will be implemented on August 1 for nations that have not yet finalised trade agreements with the United States.
Crude oil prices slipped following an unexpected move by OPEC to increase production more than anticipated for August. Brent crude futures declined by 1.2%, settling at $67.48 per barrel. Meanwhile, US West Texas Intermediate (WTI) crude dropped 2.03% to $65.64 per barrel.
Gold prices edged lower as U.S. President Donald Trump hinted at positive developments in several trade deals and announced a delay in imposing tariffs on multiple countries. Spot gold was down 0.3%, trading at $3,323.71 per ounce, while US gold futures also dipped 0.3% to $3,332.20.
The US dollar remained close to its multi-year lows as traders kept a close watch on any last-minute developments in global trade talks ahead of the tariff deadline. The dollar index, which tracks the greenback against a basket of six major currencies, was steady at 96.967, just above its recent 3.5-year low of 96.373.
Disclaimer: The article is for informational purposes only and not investment advice.
For android only