GLOBAL MOOD: Cautiously Risk OnDrivers: Trade deals in focus, FOMC meeting aheadInvestors started the week with a cautiously optimistic tone as markets weighed a fresh US-EU trade deal and marathon US-China talks aimed at extending a fragile tariff truce. Gains in equities and oil reflected improved sentiment, but attention is now firmly on this week’s Federal Reserve meeting and a busy line-up of corporate earnings. TODAY’S WATCHLIST - Earnings: Larsen & Toubro, NTPC, Piramal Enterprises - FOMC two-day meeting starts THE BIG STORYSenior US and Chinese economic officials met in Stockholm on Monday for over five hours in a bid to resolve deep-rooted disputes that have fuelled a prolonged trade war. The discussions aimed to extend a fragile truce and secure a lasting tariff agreement before the 12 August deadline set by the Trump administration. Without a deal, tariffs could return to triple-digit levels, threatening global supply chains with severe disruption. The talks, attended by Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer, ended without a statement, with negotiations set to resume on Tuesday. The meeting follows preliminary agreements in May and June that temporarily eased tensions but left key issues unresolved. Separately, President Trump warned Russia it has 10 to 12 days to show progress in ending the Ukraine war or face new consequences. Data SpotlightUS Texas manufacturing stabilised in July, with the Dallas Fed’s business activity index rebounding to 0.9 from -12.7 in June. Production jumped to its strongest level over three years, while capacity use and shipments turned positive. New orders stayed weak but improved, and hiring, sentiment and work hours all picked up despite lingering cost pressures. In the UK, public sector productivity rose 1.0% year-on-year in Q1 2025, the fastest pace in two years, up from 0.8% in the previous quarter. However, productivity remains below pre-pandemic levels. Weak productivity growth has continued to be a drag on the UK economy since the 2008 financial crisis. Takeaway: The latest data points to an overall modest resilience in economic activity despite underlying structural challenges. WHAT HAPPENED OVERNIGHT S&P 500 and Nasdaq extend record run on US-EU trade deal US stocks were little changed on Monday, with the S&P 500 closing at a record high for the sixth consecutive session and the Nasdaq also ending at a new high. Energy stocks outperformed, with Exxon Mobil up 1% and Chevron up 0.9%, while materials lagged. Dow Jones slipped 64 points US Treasury yields rise after trade deal and ahead of Fed meeting Yields climbed on Monday as a US-EU trade agreement boosted risk sentiment and investors absorbed recent bond auctions. The 10-year US Treasury yield rose 2.8 bps to 4.414%, while the 2-year yield, closely linked to Fed rate expectations, edged up 1.1 bps to 3.928%. The Fed begins its policy meeting on Tuesday and is expected to keep rates unchanged while assessing the inflationary impact of tariffs. US dollar strengthens after US-EU trade deal The Dollar Index (DXY) jumped 1.07% to 98.65 on Monday as markets welcomed a US-EU trade agreement that eased fears of a global trade war. The greenback gained 1% against the Swiss franc, and 0.59% against the Japanese yen. The deal provided a boost to risk sentiment and lifted the dollar against major peers. Crude oil prices jump on US-EU trade deal and Russia sanctions threat Brent crude oil rose 2.3% to settle at $70.04 per barrel, while WTI climbed 2.4% to $66.71. Prices surged on Monday after the US and European Union finalised a trade deal, easing concerns over global growth. Additional support came from President Trump’s warning that Russia must end the war in Ukraine soon or face fresh sanctions, heightening geopolitical risks in energy markets. DAY’S LEDGER Economic Data: US June Provisional Trade Data US June JOLTS Job Openings Data US Retail Sales US May Monthly House Price US July Consumer Confidence Index Corporate Actions: Earnings: Arvind, Bank of India, Bharat Gears, Blue Dart Express, Deepak Fertilizers and Petrochemicals Corporation, Dilip Buildcon, Gabriel India, Gateway Distriparks, GMR Airports, Greenply Industries, HeidelbergCement India, J.Kumar Infraprojects, Kolte - Patil Developers, Larsen & Toubro, Nilkamal, NTPC, Piramal Enterprises, New India Assurance Company, Welspun Corp, Zee Media Corp Piramal Enterprises to consider fund raising Tilaknagar Industries to consider fund raising Policy Events: US FOMC two-day meeting starts Tickers to Watch ADANI TOTAL GAS: PAT slips 4% YoY to ₹1.65 billion despite 21% revenue rise; cost surge hurts margins. BHARAT ELECTRONICS: PAT up 25% YoY to ₹9.69 billion FIVE-STAR BUSINESS FINANCE: CEO Rangarajan Krishnan resigns; CMD to oversee operations. GAIL (INDIA): PAT drops 31% YoY to ₹18.9 billion on weak gas transmission, higher expenses. GO DIGIT: PAT jumps 37% YoY to ₹1.38 billion on strong investment income, premium growth. GRAVITA INDIA: Net profit rises 39% YoY to ₹932.6 million; other income up fourfold. INDUSIND BANK: PAT down 68% YoY to ₹6.84 billion on elevated provisions; NII drops 14%. INFOSYS: Partners Germany’s RWE to automate digital workplace, boost efficiency. MAZAGON DOCK: PAT plunges 35% YoY to ₹4.52 billion on high spares cost; revenue rises. MOTHERSON SUMI WIRING: PAT dips 3.8% YoY to ₹1.43 billion; expenses outpace revenue. MUTHOOT FINANCE: Appoints Thomas Kokkoth as CRO; seeks shareholder nod for board changes. NTPC GREEN ENERGY: PAT rises 59% YoY to ₹2.2 billion on robust revenue; down 5.5% QoQ. OIL & NATURAL GAS CORP: Signs joint operating pact with BP, RIL for Saurashtra offshore block. PNC INFRATECH: Wins ₹29.57 billion coal logistics project in Chhattisgarh from SECL. RAILTEL: PAT jumps 36% YoY to ₹661 million; revenue up 33%, slumps QoQ. TORRENT PHARMA: PAT rises 20% YoY to ₹5.48 billion NIPPON LIFE AMC: PAT at ₹3.96 billion; AUM surges 27% YoY to ₹6.13 trillion. MUST READ Jane Street seeks more time from Sebi to respond to July 3 order MF investor growth slows to 5.2% in H1 2025 amid market volatility Inflation likely to undershoot RBI's target in FY26: FinMin review America’s energy crown tilts as India’s clean power drive nears superpower status US, China start talks in Sweden eyeing trade truce extension Japan expects 1%-2% of $550 billion US Fund to be investment EU’s $750 billion energy deal with Trump looks hard to reach See you tomorrow with another edition of The Morning Edge. Have a great trading day. As India and the US negotiate a bilateral trade deal, strategic leverage is key. With China tightening its mineral exports, India’s reserves of bauxite, copper, graphite, and manganese could be vital in reshaping global supply chains. G Chandrashekhar writes how in the ongoing talks, can India use this strength to soften Washington’s tariff stance and secure better terms?
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