Indian Shares Extend Losses On Trade Deal Uncertainty

Indian shares ended lower on Tuesday as the cryptocurrency slump intensified, and incoming economic indicators pointed to a slowing U.S. economy.

Rising Japanese government bond yields and yen strength threatened to unwind the decades-old yen carry trade, sparking global deleveraging in equity and crypto markets.

As economic uncertainties mount, investors also awaited a slew of key U.S. economic data this week for additional clues on the path forward for U.S. monetary policy.

Closer home, the RBI MPC meeting will be held from December 3 to December 5, with most analysts expecting the central bank to keep the repo rate unchanged at 5.50 percent.

On the trade front, Nomura in its latest note said the outcome for a U.S.-India trade deal remains a big uncertainty despite positive noise from both camps.

The foreign brokerage said it believes the deal will be signed soon, and tariffs will likely be set closer to 20 percent.

The benchmark BSE Sensex dropped 503.63 points, or 0.59 percent, to 85,138.27, extending losses for a third straight session.

The broader NSE Nifty index fell 143.55 points, or 0.55 percent, to 26,032.20 while the BSE mid-cap and small-cap indexes dipped 0.1 percent and half a percent, respectively.

The market breadth was weak on the BSE, with 2,546 shares falling while 1,605 shares advanced and 165 shares closed unchanged.

Among the prominent decliners, Larsen & Toubro, BEL, ICICI Bank, Reliance Industries, HDFC Bank and Axis Bank all fell over 1 percent.

Asian Paints jumped 3.1 percent to hit a new 52-week high after UBS upgraded its rating on the stock.

Globally, Asian markets ended mostly higher, with automakers rallying in Seoul after U.S. Commerce Secretary Howard Lutnick confirmed that the general tariff rate on imports from South Korea, including on autos, would drop to 15 percent.

European stocks inched higher in early trade, with Ukraine peace talks and upcoming U.S. economic data in focus.

After U.S. officials met a Ukrainian delegation in Florida, Ukrainian President Volodymyr Zelenskyy said that the revised U.S. proposal for ending the war with Russia “looks better.”

Media reports suggest that U.S. President Donald Trump’s special envoy Steve Witkoff has left for Moscow to meet Russian President Vladimir Putin and discuss a revised 19-point peace plan to end the Ukraine war.

Gold prices fell more than 1 percent after surging to a six-week high in the previous session.

Oil prices dipped from a two-week high as traders watched for U.S. President Donald Trump’s next steps on Venezuela, and assessed the fallout from damage to a key Black Sea terminal.

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