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Indian markets declined on Thursday as heavy foreign portfolio investor (FPI) selling and concerns over the December quarter earnings continued to dent sentiments. Today, markets are likely to continue their lacklustre performance with negative start amid lack of directional cues from global as well as domestic markets. The earnings season kicked off with TCS reporting its Q3 numbers, investors now brace for a wave of financial disclosures expected to shape market sentiment. All eyes will be on the upcoming Q3 results, anticipated to provide key cues for the market's direction. Traders will be concerned as FIIs continued their selling spree, offloading shares worth Rs 7,170.87 crore on January 9. Some pessimism will come with a private report that the Indian rupee will extend its steady decline against a strong US dollar amid heightened market expectations of a Reserve Bank of India interest rate cut next month. Some caution may prevail amount market participants with report that the nominal GDP is likely to miss the Budget projection for growth for the second consecutive year in FY25. While the government projected 10.5 percent growth for this fiscal year, the nominal GDP growth, according to the first advance estimate released on January 7, was 9.7 percent. There will be some cautiousness as India Ratings said that any broad-based or strong recovery in corporate capital expenditure was unlikely in the upcoming financial year 2026 (FY26) due to uncertainty of domestic and external demand. It added the uncertainty is adversely affecting the overall corporate sector capex. Interest rates on credit are not the primary deterrent to decisions about capital expenditure. However, traders may take note of Commerce and Industry Minister Piyush Goyal’s statement that India has the potential to increase exports of organic products up to Rs 20,000 crore in the next three years. Meanwhile, the Securities and Exchange Board of India (Sebi) has postponed the implementation of two measures aimed at curbing excessive activity in index derivatives. The upfront collection of option premiums and the removal of calendar spread treatment on expiry days will now take effect on February 10, instead of February 1. There will be some reaction in telecom stocks with report that continuing to push back against the stringent quality of service (QoS) norms brought in by the Telecom Regulatory Authority of India (Trai), telcos have informed the Department of Telecommunications (DoT) that collection and submission of monthly and site-to-cell-level data should be eased.

The US markets remained closed on Thursday for the funeral of former President Jimmy Carter. Asian markets are trading mixed on Friday as investors digested data on Japan's November pay and household spending.

Back home, Indian equity benchmarks ended lower by over half percent on Thursday due to heavy selling in market heavyweights Larsen & Toubro, Tata Motors and HDFC Bank. After making a cautious start, key gauges slipped into red and extended losses as the day progressed as investors turned nervous over earnings growth concerns amid unabated foreign capital outflows. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,362.18 crore on Wednesday, according to exchange data. The Indian stock markets mirrored the decline across its Asian peers, with cautious investor sentiment driven by a sell-off in US bonds. The US 10-year Treasury yield surged to its highest level since April 2024, signalling expectation of fewer rate cuts by the Fed. Further, disappointing inflation data from China added pressure, indicating that recent stimulus measures have failed to rejuvenate one of the world's largest consumer markets. Traders ignored Agricultural and Processed Food Products Export Development Authority (APEDA) Chairman Abhishek Dev’s statement that Indian exporters have huge opportunities to increase their share in the global agriculture trade from the current 2.4 per cent. The global agriculture trade is about $2 trillion. He said that given these numbers, huge opportunities are there to increase exports from the country. The street also paid no heed towards reports that the United Nations kept its growth forecast for the Indian economy unchanged at 6.6 percent for 2025, as it noted that private investment and consumption along with strong export growth of services and technology will help sustain the momentum. Finally, the BSE Sensex fell 528.28 points or 0.68% to 77,620.21, and the CNX Nifty was down by 162.45 points or 0.69% to 23,526.50.

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