Indian Equities Poised for Flat Open Amid Profit-Taking and Mixed Corporate Outlook

Indian equity benchmarks are likely to open with little change, capping a week that saw mild losses. Profit-taking is expected to offset positive corporate earnings and expectations of progress in India-US trade talks. Both the Nifty 50 and Sensex have experienced a decline of approximately 0.8% this week, following a significant 4.5% rise in October. Asian markets mirrored a decline in Wall Street, influenced by a sell-off in AI stocks and economic uncertainty from the ongoing US government shutdown. Indian equities are experiencing profit-taking amidst continuous foreign outflows. Foreign Portfolio Investors (FPIs) net sold shares worth ₹32.63 billion ($371.24 million) on Thursday for the sixth consecutive session, while Domestic Institutional Investors (DIIs) net bought shares worth ₹52.84 billion.

US President Donald Trump indicated positive progress in his talks with Indian Prime Minister Narendra Modi and plans for a visit, amidst ongoing trade negotiations. India faces a 50% punitive tariff on exports to the US, partly in retaliation for its Russian oil purchases.

Among individual stocks, Lupin might see a rally due to a 73.3% jump in second-quarter profit, driven by strong demand for its respiratory drugs. Life Insurance Corporation of India could also rise after reporting higher quarterly profit and improved margins. GMM Pfaudler reported a nearly three-fold year-on-year rise in consolidated profit. Mankind Pharma reported its fourth consecutive quarterly profit fall. Apollo Hospitals missed second-quarter profit expectations. Amara Raja beat second-quarter profit estimates.

Approximately 40% of Indian companies that have reported quarterly results have received earnings upgrades, according to Jefferies.

Impact: The news suggests a mixed near-term outlook for the Indian market. Profit-taking and foreign outflows could lead to some consolidation, while strong domestic demand and positive corporate earnings provide underlying support. The progress in India-US trade talks could also be a positive catalyst. Individual stock performance will depend on their specific results and outlook. The impact on the Indian stock market is moderate, rated at 6/10.

Difficult Terms: Equity Benchmarks: Stock market indices that represent the overall performance of a stock market. Examples include Nifty 50 and Sensex. Profit-taking: The act of selling a stock or other asset after its price has risen significantly, in order to realize the profit. Corporate Earnings Outlook: A projection of a company's future profitability. India–US Trade Talks: Negotiations between the governments of India and the United States concerning trade policies, tariffs, and agreements. Gift Nifty futures: A Nifty futures contract traded in an offshore market, which indicates the likely opening trend of the Indian Nifty 50 index. Nifty 50: A benchmark Indian stock market index representing the weighted average of 50 of the largest Indian companies listed on the National Stock Exchange. Sensex: A benchmark Indian stock market index representing the weighted average of 30 of the largest Indian companies listed on the Bombay Stock Exchange. Foreign Portfolio Investors (FPIs): Investors from other countries who invest in financial assets (like stocks and bonds) in India. Domestic Institutional Investors (DIIs): Institutions within India (like mutual funds, insurance companies) that invest in financial assets. Punitive Tariffs: Extra taxes imposed on imported goods as a penalty. Consolidated Profit: The total profit of a company after combining the profits of its parent company and all its subsidiaries. Admissions: In the context of hospitals, it refers to the number of patients admitted for treatment.