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Indian equity benchmarks are likely to get a cautious start on Thursday tracking weakness in Asian counterparts amid Fed caution and lingering tariff concerns. Som cautiousness may come as foreign portfolio investors resumed their selling streak on Wednesday and offloaded shares worth Rs 1,881.30 crore.

Some of the key factors to be watched:

US reciprocal tariffs to have limited impact on India: S&P Global Ratings said the impact of the US reciprocal tariff will be limited on India as the economy is domestically oriented with less reliance on exports. It also said India will clock a 6.7-6.8 per cent GDP growth over the next two years.

High frequency indicators point at sequential pickup in economic activity: RBI Bulletin said high frequency indicators, like vehicles sales, air traffic, steel consumption and GST E-way bills, point towards a sequential pickup in momentum of economic activity during the second half of the fiscal 2024-25 and sustain moving forward.

India and Argentina strengthen cooperation in lithium exploration: India and Argentina have signed an agreement for deeper collaboration in exploration and resource development of critical minerals, particularly lithium.

Power stocks will be in limelight: Moody's Ratings said India's power sector - the biggest carbon emitter - will need massive $700 billion investment over the next 10 years to help the country achieve its 2070 net-zero pledge.

Indian drugmakers likely to be hit: U.S. President Donald Trump reportedly said he intends to impose a 25% or higher levies on semiconductors and pharmaceutical imports, and raise it substantially over the course of a year, a move likely to hit India's sprawling pharmaceutical industry.

On the global front: The US markets ended higher on Wednesday as investors scrutinized the minutes from the Federal Reserve's January policy meeting and digested U.S. President Donald Trump's tariff plans. Asian markets are trading mostly in red on Thursday after Federal Reserve meeting minutes signaled that it’s in no rush to cut interest rates.

Back home, Indian equity benchmarks oscillated between gains and losses throughout the day and finally ended flat with negative bias on Wednesday, dragged by blue-chip TECK and IT stocks.  Finally, the BSE Sensex fell 28.21 points or 0.04% to 75,939.18, and the CNX Nifty was down by 12.40 points or 0.05% to 22,932.90.

Some of the important factors in trade: 

Concerns over tariff-related trade war: A cautious undertone prevailed as first round of talks between the U.S. and Russia over potential peace deal in Ukraine ended with no clear path and U.S. President Donald Trump said he intends to impose 25 percent tariffs on autos, pharmaceuticals, and chips. 

A reversal in FII flows: Foreign Institutional Investors (FIIs) turned buyers on Tuesday after unabated selling. They bought equities worth Rs 4,786.56 crore, according to exchange data. 

India GDP growth estimated at 6.3% in FY25: The SBI, in its research, has estimated GDP growth during 2024-25 to be 6.3 per cent. It said that a healthy rural economy is reinforcing stability and sustains momentum in other sectors. 

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