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Indian equity markets are likely to make positive start on Tuesday, supported by optimism around improving trade relations between India and the United States (US). Sentiments may get a boost from reports indicating a team of US trade officials will visit India in August for the next round of talks for the proposed bilateral trade deal between the two nations. However, gains may be capped due to foreign institutional investor (FII) funds outflows.

Some of the key factors to be watched:

India's share in US imports increasing in electronics, agri, textiles: A private report said that restructuring of tariffs by the US has led to a shift in the list of key product suppliers to the American market, with India emerging as one of the beneficiaries at the expense of China and Canada.

India, UK to sign trade pact on July 24: Commerce and Industry Minister Piyush Goyal will accompany Prime Minister Narendra Modi to London for the signing of the free trade agreement between India and the UK on July 24. 

US team to visit India in August for next round of talks for trade pact: A report said that the US team will visit India in August for the next round of negotiations for the proposed bilateral trade agreement between the two countries.

Eight core sectors' growth slows down to 1.7% in June: The government data showed that India's eight core infrastructure sectors' growth slowed down to 1.7 per cent in June 2025 from 5 per cent in the same month last year.

RBI proposes ban on display of third party products on banks' digital channels: RBI's draft norms issued that third-party products and services should not be displayed on banks' digital banking channels.

On the global front: The U.S. markets ended mostly in green on Monday, as traders were optimistic about potential trade deals, with Commerce Secretary Howard Lutnick saying he is confident the U.S. will reach an agreement with the European Union. Asian markets are trading mixed on Tuesday, as investors adopted a cautious stance ahead of upcoming tariff deadlines.

Back home, Snapping the two-day falling streak, Indian equity benchmarks ended higher by around half percent on Monday following buying in blue-chip stocks HDFC Bank and ICICI Bank after their quarterly earnings. Firm trend in Asian markets and fresh foreign fund inflows also supported the markets. Finally, the BSE Sensex rose 442.61 points or 0.54% to 82,200.34 and the CNX Nifty was up by 122.30 points or 0.49% to 25,090.70.   

Some of the important factors in trade:

India needs to be careful, clever while negotiating trade agreements with US: Former RBI Governor Raghuram Rajan has said that India needs to be very careful and clever while negotiating trade agreements with the US, especially with regard to the agriculture sector, which is heavily subsidised by developed countries. 

India’s $15 billion oil exports to EU at risk amid new Russia sanctions: The Global Trade Research Initiative (GTRI) has said that India's petroleum product exports worth $15 billion to the European Union (EU) may be at risk as Brussels moves to restrict imports of Russian crude oil refined in third countries. 

Automobile sector stocks in watch: Automobile sector stocks were in watch as industry body SIAM said that Automobile exports from India rose 22 per cent year-on-year in the April-June quarter driven by record shipment of passenger vehicles and robust growth in segments like two-wheelers and commercial vehicles.

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