US-China Trade Deal Paused, India's GST Collections Rise Amid Mixed Global Cues

GIFT Nifty began Monday's session down 0.19% at 25,851, with market participants closely watching global cues from crude oil, gold, and currency movements. On October 31, Indian markets ended in the red, with the Sensex declining 0.55% and the Nifty falling 0.60%.

However, positive domestic data emerged as India's Goods and Services Tax (GST) revenue for October rose 4.6% year-on-year to Rs 1.96 lakh crore, an increase from Rs 1.87 lakh crore in the same month last year. This growth occurred despite recent tax cuts by the GST Council.

Globally, Asian markets showed a mixed start, with South Korea's Kospi opening higher while Australia's ASX 200 slipped. Japan's market was closed for a holiday. US markets closed higher on Friday, October 31, with the Nasdaq Composite, S&P 500, and Dow Jones all posting gains.

The most significant news was US President Donald Trump announcing a trade and economic deal with China, which pauses the ongoing tariff battle. Both nations agreed to suspend retaliatory measures. China will lift export controls on rare earth materials and open its markets to US farm products like soybeans, pork, and wheat. Beijing also agreed to halt non-tariff restrictions and remove certain US firms from its unreliable entity list.

The US Dollar Index (DXY) saw a slight uptick, trading 0.02% higher, while the Indian Rupee appreciated 0.07% against the dollar on October 31. Crude oil prices moved higher, with WTI crude up 0.71% and Brent crude gaining 0.67%, which could impact India's import costs.

In terms of investor flows, Foreign Institutional Investors (FIIs) offloaded Indian equities worth Rs 6,769 crore on October 31, while Domestic Institutional Investors (DIIs) turned net buyers, investing Rs 7,068 crore.

Impact: This news has a moderately positive impact on the Indian stock market. The US-China trade deal reduces global economic uncertainty, potentially boosting investor confidence and global trade, which can benefit Indian exporters. Strong GST collections indicate underlying economic health in India. However, rising crude oil prices and continued FII selling pose headwinds. Rating: 7/10.

Difficult terms: GIFT Nifty: An offshore index representing the performance of Indian companies listed on the NSE. GST Collections: Revenue generated from the Goods and Services Tax. Asian Markets: Stock markets located in Asian countries. US Markets: Stock markets in the United States. Nasdaq Composite: A stock market index comprising most stocks listed on the Nasdaq exchange. S&P 500: A stock market index tracking 500 of the largest US publicly traded companies. Dow Jones Industrial Average: A stock market index representing 30 large, publicly traded US companies. Trade and Economic Deal: An agreement between nations concerning commerce and economic policies. Tariff Battle: A dispute involving countries imposing taxes on each other's imported goods. Export Controls: Government restrictions on the sale of specific goods to foreign countries. Rare Earth Materials: A group of 17 elements critical for modern technology. Unreliable Entity List: A government list of foreign entities deemed untrustworthy, restricting their trade. US Dollar Index (DXY): A measure of the US dollar's value against a basket of six major foreign currencies. Indian Rupee: The currency of India. Crude Oil: Unrefined petroleum, a key global commodity. WTI Crude: West Texas Intermediate, a US benchmark for crude oil. Brent Crude: A global benchmark price for crude oil. FIIs (Foreign Institutional Investors): Overseas entities investing in domestic markets. DIIs (Domestic Institutional Investors): Indian entities investing in domestic markets.