Indian equity benchmarks Sensex and Nifty 50 are likely to open on a flat note on Wednesday, tracking weak overnight global cues, even as the India–US trade deal announcement keeps domestic sentiment positive and investors look forward to finer details of the agreement.

Asian markets traded mixed, while Wall Street closed lower overnight after technology stocks witnessed a sell-off.

However, on Tuesday, Indian equities posted sharp gains across the board, buoyed by optimism surrounding the India–US trade deal.

Domestic Market Recap

On Tuesday, Indian indices closed in the green:

• Sensex skyrocketed by 2,072.67 points (2.54%) to close at 83,739.13
• Nifty 50 moved up by 639.15 points (2.55%) to settle at 25,727.55

Gift Nifty

Furthermore, the Gift Nifty was trading near 25,824, around 7 points higher than the previous Nifty futures close, hinting at a lacklustre start for Indian markets.

Overnight Wall Street Performance

Moreover, the US stock market closed sharply lower on Tuesday as heavy selling in technology stocks, driven by concerns that artificial intelligence could intensify competition for software companies, dragged indices down.

• The Dow Jones Industrial Average slumped by 166.67 points (0.34%) to close at 49,240.99.
• S&P 500 down by 58.63 points (0.84%), ending at 6,917.81.
• The Nasdaq Composite was lower by 336.92 points (1.43%), finishing at 23,255.19.

Overnight Major Global Events Driving Sentiment

1. India–US Trade Deal: Union Commerce and Industry Minister Piyush Goyal said negotiating teams are in the final phase of ironing out details of the India–US trade deal. He noted that India has secured more favourable terms than its peers and ensured full protection for sensitive sectors, especially agriculture and dairy.
2. US–Iran Tensions: The US military shot down an Iranian drone on Tuesday after it aggressively approached the aircraft carrier USS Abraham Lincoln in the Arabian Sea, Reuters reported. The military said an Iranian Shahed-139 drone flew toward the carrier with unclear intent, prompting an F-35 fighter jet to intercept it.
3. NVIDIA–OpenAI Deal: Nvidia is close to sealing a $20 billion investment in OpenAI as part of the AI firm’s latest funding round, according to Bloomberg News. OpenAI aims to raise up to $100 billion, which could value the ChatGPT maker at around $830 billion.
4. Japan Services PMI: Japan’s services sector grew at its fastest pace in nearly a year, while overall private-sector activity expanded at the quickest rate in 32 months. The S&P Global final Japan Services PMI climbed to 53.7 in January from 51.6 in December, marking the tenth straight month of expansion and slightly exceeding the flash estimate of 53.4.

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