Synopsis : Indian markets erased early losses to close higher after signals of renewed India–US trade talks lifted sentiment late in the session. However, weakness in FMCG and IT stocks kept gains capped as investors stayed cautious.
Indian equity benchmarks staged a smart late-session rebound on Monday, snapping a five-day losing streak as optimism over renewed India–US trade engagement helped offset earlier selling pressure. Both the Sensex and Nifty swung between gains and losses during the day before closing in positive territory, reflecting a cautious but improving investor mood.
Markets initially struggled due to persistent selling in FMCG and IT stocks, coupled with profit booking across several consumption-linked sectors. However, sentiment improved sharply after the incoming US ambassador to India confirmed that formal trade discussions between New Delhi and Washington would begin on January 13, offering fresh hope of easing trade-related uncertainties.
Sectoral Trends: Financials and Metals Offer Support
While broader market participation remained limited, banking, metals, and financial services stocks provided stability. These sectors attracted selective buying as investors looked for relatively defensive and value-driven opportunities.
On the other hand, auto, pharma, realty, FMCG, and IT stocks remained under pressure, suggesting that risk appetite is still selective rather than broad-based. Market experts say this reflects a rotation-driven market, where investors prefer specific pockets instead of chasing the overall index.
Global Cues Largely Supportive
Overseas markets offered mixed-to-positive signals. Asian equities largely traded higher, with Japan’s Topix and Hong Kong’s Hang Seng posting solid gains, while US futures remained slightly weak. European futures also traded mildly higher, indicating that global risk sentiment remains supportive but not fully risk-on.
What This Means for Investors
The late recovery signals that investors are willing to buy on dips when positive policy or geopolitical developments emerge. However, continued selling in consumption and tech stocks shows that concerns around growth, margins, and global demand are still influencing positioning.
With upcoming developments on trade negotiations and macro data, markets may continue to trade in a range with sharp intraday swings, driven by news-based triggers rather than sustained momentum.
Disclaimer : This article is for informational purposes only and does not constitute investment advice. Stock markets are subject to risks, and investors should consult qualified financial advisors before making any investment decisions.
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