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Indian markets are likely to make a cautious start on Tuesday amid weak global cues due to sell-off in technology stocks. Some cautiousness may come amid foreign fund outflows as foreign institutional investors (FIIs) were net sellers of shares worth Rs 635.91 crore on Monday. Meanwhile, there will be some volatility in the markets ahead of weekly expiry of Nifty F&O contracts. 

Some of the key factors to be watched: 

India’s core sector growth slows to 0.5% in May: The government data showed that India’s eight core sectors grew at a slower pace of 0.5% in May 2026, weighed down by contractions in coal, crude oil, natural gas, refinery products and fertiliser output.

Adverse monsoon may pose headwinds for domestic growth, inflation outlook: The Reserve Bank Bulletin said an adverse south-west monsoon may pose headwinds for the domestic growth and inflation outlook, even as the global economic landscape remains fragile.

MFIs face collection risks from inflation, cash flow: Crisil report said risks such as potential inflationary pressures or reduction in discretionary household cash flows are likely to affect repayment behaviour of microfinance borrowers, even though the West Asia conflict has not directly affected the sector.

MSMEs key to Viksit Bharat vision: RBI Governor Sanjay Malhotra has said MSMEs are the nursery of entrepreneurship and are central to the Viksit Bharat vision. Malhotra noted that credit growth in the MSME sector has outpaced overall credit growth and said Kerala has performed strongly in this regard.

Govt imposes anti-dumping duty on chemical imported from China, EU, US: India has imposed an anti-dumping duty for five years on a chemical, used in the rubber and tyre industries, imported from China, the European Union and the US. The duty ranges between $75 per tonne and 1748 per tonne.

Global front: The US markets end mostly lower on Monday amid fall in Big Tech stocks. Asian markets are trading mostly in red on Tuesday tracking overnight weakness on Wall Street.

Back home, Indian equity benchmarks ended in positive territory on Monday following a decline in crude oil prices and supportive global cues amid hopes of diplomatic progress in US-Iran talks. Fresh foreign fund inflows and buying in blue-chips Tech Mahindra and Sun Pharma also supported the markets. Finally, the BSE Sensex rose 291.17 points or 0.38% to 77,094.07 and the CNX Nifty was up by 89.80 points or 0.37% to 24,102.90. 

Some of the important factors in trade: 

India, EU to sign FTA by December 2026: With an aim to deepen economic ties and strengthen bilateral trade, Commerce and Industry Minister Piyush Goyal has stated that India and the 27-member European Union (EU) are likely to sign a Free Trade Agreement (FTA) by December 2026, with implementation likely between February and March 2027. 

India, South Korea hold discussions on digital governance, service delivery: India and South Korea have held discussions on strengthening cooperation between the two countries in areas such as digital governance, e-government services, public administration, capacity development, and citizen-centric service delivery. 

India seeks BRICS nations' cooperation to strengthen MSME sector, boost growth: India has said that the cooperation among BRICS nations can help strengthen micro, small and medium enterprises, support weaker sections and contribute to the economic growth of member countries.

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