Sensex, Nifty Set To Extend Losses On Trade Deal Uncertainty

(RTTNews) - Indian shares are seen opening lower on Tuesday after several European leaders voiced concerns over the EU-U.S. trade deal, calling it 'lopsided' and 'unsustainable'.

Closer home, market watchers firmly believe that a mini or an interim trade deal between the United States and India is unlikely ahead of the U.S. tariff deadline set to take effect later this week.

There's considerable uncertainty over whether India will face higher tariffs from August or if U.S. President Donald Trump will extend the deadline once more.

Benchmark indexes Sensex and Nifty fell around 0.7 percent and 0.6 percent respectively on Monday after weak earnings from Kotak Mahindra Bank and TCS' layoff announcement. The rupee settled 15 paise lower at 86.66 against the U.S. dollar.

Foreign Portfolio Investors offloaded shares worth Rs 6,082 crore on a net basis Monday, while domestic institutional investors net bought shares to the extent of Rs 6,765 crore, according to provisional NSE data.

This is the highest net selling by FIIs since May 30 and highest net buying by DIIs since June 17.

Asian markets were subdued this morning as investors await the outcome of the U.S.-China trade talks.

The dollar index held on to gains ahead of the Fed and BoJ meetings this week while oil slipped after rising 2 percent on Monday as U.S. President Trump pushed for Russia to reach a swift truce with Ukraine or face potential economic penalties.

Gold edged up slightly after declining notably on Monday amid trade-deal hopes. U.S. stocks ended mixed overnight as traders' enthusiasm for the U.S.-EU deal was muted.

The tech-heavy Nasdaq Composite rose 0.3 percent and the S&P 500 edged up marginally to reach new record closing highs while the narrower Dow slid 0.1 percent.

European stocks ended mostly lower on Monday as the EU-U.S. trade deal met with gloomy reactions from many European leaders, with Germany and France slamming the draft trade agreement as unequal and damaging.

The pan European STOXX 600 eased 0.2 percent. The German DAX lost 1 percent while the U.K.'s FTSE 100 and France's CAC 40 both fell by 0.4 percent.