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Informist, Wednesday, Feb. 4, 2026

 

By Eshitva Prakash

 

MUMBAI – Benchmark indices are expected to remain range-bound Thursday as investors await clarity on the India-US trade deal in order to ascertain the impact of import duty cut across sectors. Though investor sentiment around the deal remains positive, analysts are waiting for information from official channels to make decisive recommendations. Apart from a slew of December quarter earnings, investors will focus on information technology stocks and on companies related to crude oil production.

 

Foreign investors are expected to continue covering their short positions on hopes of a pick-up in corporate earnings in the current quarter and recovery in the rupee. In the trade deal with the US, India has ensured that the interests of sensitive sectors such as agriculture and dairy are protected, Commerce and Industry Minister Piyush Goyal had said Tuesday.

 

"India has not confirmed where it will be reducing import tariffs in return and hasn't yet dropped any barriers," Vinit Bolinjkar, head of research at Ventura Securities, said. He expects large gains for textile companies, semiconductor manufacturers, and automation-related companies. However, information technology companies are seen weak since their large presence in the US may expose them to the expected macroeconomic slowdown in the country, the analyst said.

 

With the tariffs now more than halved, the GDP drag from tariffs will halve to about 0.03%, HSBC Global Investment Research said in a research report. These numbers assume that one-third of exports are exempt from tariffs, while some sectors such as automobile, steel, and aluminium face differential tariffs. The brokerage expects India's competitiveness to improve in the US markets on lower effective tariffs than other Asian peers.

 

The brokerage also sees the rupee recovering to 88 per dollar by March end. "We think the INR is now slightly undervalued – with the real effective exchange rate at 5?low its long-term moving average," HSBC said. The brokerage is waiting for clarity on what sectors will be safeguarded under the India-US trade deal after the US president mentioned that India will lower all tariff and non-tariff barriers on US goods to zero.

 

Oil and gas companies will be in focus amid rising prices of crude oil. The next round of Iran-US de-escalation talks will happen in Oman and scheduled later this week. These talks follow the recent escalation in conflict after US navy personnel shot down an Iranian drone. In the medium-term, views are divided about oil companies that still source crude oil from Russia.

 

Import data shows India has reduced its oil purchases from Russian sources. HSBC believes that the discount on Russian oil has fallen, so switching to other sources may not be too costly. On the other hand, Sumit Pokharna, vice president of research at Kotak Securities, sees crude oil prices rising by $6-$8 per barrel, which may help the margins of oil explorers such as Oil and Natural Gas Corp. and Oil India, but will be detrimental to the profitability of refiners.

 

Information technology companies will also be in focus after the slide Wednesday. While analysts said that the crash was more of a knee-jerk reaction, there are fears that the number of clients for core software developers may be hurt by artificial intelligence tools, considering that AI players could replace core software and business models based on outsourcing. However, instead of competing with players like Anthropic, Indian IT companies will partner with them in order to improve their service offerings, Rishubh Vasa, research analyst at Indsec Securities & Finance, said. "Anthropic should not be looked on as a competitor, but rather a potential partner," Vasa said.

 

The Nifty 50 is expected to face resistance at 25850 points and find support at around 25600 points, said Rupak De, technical analyst at LKP Securities. The 50-stock index Wednesday closed at 25776 points, up marginally. Among other companies, investors will keenly watch for December quarter earnings of Bharti Airtel, Max Healthcare Institute, and Tata Motors Passenger Vehicles on Thursday.  End

 

Edited by Ashish Shirke

 

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