Rupee stays pressured near record low levels amidst tariff concerns; RBI eyed
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Economic Times
7 minutes ago
- Economic Times
China defends Russian oil buys after Trump's tariff threats
Synopsis China has defended its Russian oil imports as lawful, pushing back against U.S. criticism following Washington's move to impose secondary tariffs on India for similar purchases. The Chinese Foreign Ministry stated it would continue energy cooperation based on national interests. U.S. President Donald Trump suggested that China could also face tariffs, saying 'that may happen,' while Treasury Secretary Scott Bessent noted such action 'could be on the table.' AP China defended its Russian oil imports as legitimate, responding to US pressure after Washington imposed secondary tariffs on India over its energy purchases from Moscow.'It is legitimate and lawful for China to conduct normal economic, trade and energy cooperation with all countries around the world, including Russia,' the Chinese Foreign Ministry said Friday in a statement to Bloomberg News. 'We will continue to adopt reasonable energy security measures in accordance with our national interests.'US President Donald Trump said earlier this week he could punish China with additional tariffs over its purchases of Russian oil, saying 'that may happen.''Let's see what happens. You're going to see a lot more... You're going to see so much secondary sanctions,' Trump said, responding to a question on why India was being singled out despite other nations, including China, also buying Russian asked about Trump's comments on Thursday, Treasury Secretary Scott Bessent told Fox News that tariffs on China over oil purchases 'could be on the table at some point.' China's imports from Russia edged up in July to $10.06 billion — the highest level since March — according to the latest customs data. But overall this year, imports from Russia are still down 7.7% compared to the same period in 2024."China is a much more sensible target for Trump's ire if controlling Russia is really what he wants. Beijing provides far more meaningful support — economic and political — to President Vladimir Putin than New Delhi does," wrote Bloomberg's Mihir China, it appears, is "too big for Trump to bully now." Its negotiators will likely be granted more time than others to come to a deal with the US, and it can continue to support Moscow with an impunity denied to India, he relations have stabilised after both countries agreed to pause steep tariffs while talks continue. Trump said this week he was 'very close' to reaching a deal with China to extend the truce, which is set to expire on Tuesday.
Economic Times
10 minutes ago
- Economic Times
Nifty logs longest weekly losing run since 2020 crash. Here's how
Indian markets extended losses for the sixth straight week—longest since April 2020—as US tariff hikes, weak earnings, and persistent FII outflows weighed on investor sentiment. Exporters, especially in textiles and seafood, were hit hardest amid trade tensions. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads FIIs dump Indian stocks Technical indicators point to more weakness Banking sector offers little respite Muted Q1 earnings add to gloom Tired of too many ads? Remove Ads India's benchmark indices, the Nifty 50 and Sensex, logged their sixth straight weekly loss, marking their longest losing streak since the COVID-19 crash of April 2020, as both fell nearly 5% since end-June, weighed down by U.S. tariff hikes, weak earnings, and relentless foreign investor outflows that triggered a broad-based Friday, the Nifty 50 fell 0.95% to 24,363.30, while the Sensex declined 0.95% to close at 79,857.79. For the week, they shed 0.8% and 0.9%, respectively. The continued decline reflects persistent selling pressure across sectors, with little sign of relief amid deteriorating global trade relations and muted domestic shock hits exportersExport-oriented stocks led the rout after U.S. President Donald Trump announced a sharp escalation in trade tensions, doubling tariffs on Indian exports to 50%. The move, retaliation for India's continued oil trade with Russia, delivered a fresh blow to investor Stanley warned the Indian seafood export industry alone could face a potential loss of Rs 24,000 crore. 'Indian textile and apparel exporters are halting US order manufacturing due to President Trump's tariff doubling to 50%, severely impacting their competitiveness against nations like Bangladesh and Vietnam,' the brokerage said, forecasting 'export decline, job losses, and overall uncertainty in the sector.'Beyond textiles and seafood, exporters in gems and jewellery, chemicals, and auto ancillaries are now grappling with halted orders and squeezed selloff intensified as foreign institutional investors (FIIs) remained net sellers for the tenth straight session. On August 7 alone, FIIs pulled Rs 4,997.19 crore from Indian equities, taking August's total outflows to over Rs 15,950 crore. Since July, the exodus has crossed $4 billion.'FIIs have sold on all trading days of August, so far,' said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services . 'These weak indicators, along with the relatively high valuations in India, are triggering sustained selling by the FIIs.'Vijayakumar said, 'In the present context of negative sentiments in the market caused by the tariff skirmishes between India and the U.S., FIIs are likely to continue selling in the cash market.' However, he noted that 'the only saving grace is the sustained DII buying which remains strong. The strong DII buying assisted by sustained flows into mutual funds can prevent a crash in the market.'Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, noted that the Nifty has formed a bearish candle with a long upper shadow for four consecutive weeks—'signaling that every attempt at a rally is being met with strong selling pressure, indicating a lack of conviction among bulls and a clear dominance of bears at higher levels.'Shah said that the Nifty is now trading below its 20-day, 50-day, and 100-day EMAs, all sloping downward, and its RSI has entered a 'super bearish zone.' He said the MACD indicator also remains in bearish territory, with the MACD line below both the signal and zero lines.'Crucial support lies in the 24,200–24,150 zone, where the 200-day EMA and 38.2% Fibonacci retracement levels coincide,' Shah said. 'If the index slips below 24,150, it could extend its decline to 23,750. On the upside, the 100-day EMA zone of 24,570–24,600 will act as a crucial hurdle.'The banking index mirrored broader market weakness. 'The banking benchmark index Bank Nifty also ended the week on a negative note… On the weekly chart, it formed a bearish candle, indicating persistent selling pressure,' Shah index hovered near its 100-day EMA, with support seen at 54,950–54,850. 'A sustained move below 54,850 could intensify the downtrend toward 54,000–53,900,' he warned. Resistance on the upside stands at 55,700–55, earnings offered little cover. The Nifty IT index is down 10% over the past month, and the banking sector has shown little momentum. An Economic Times analysis revealed that India's top nine private banks posted only 2.7% year-on-year profit growth in Q1, reflecting weak credit appetite and sluggish macro momentum.'There are no indications yet of a sharp uptick in earnings for FY26,' Vijayakumar said, adding that the market remains both 'technically and fundamentally weak.'With foreign selling unrelenting, global macro risks mounting, and Q1 results underwhelming, investors may need to brace for continued volatility. Unless trade tensions ease or earnings deliver a surprise turnaround, the path ahead for Indian equities remains fraught with risk.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Mint
10 minutes ago
- Mint
States step up borrowing in July as capex drive gains pace
New Delhi: State governments sharply ramped up their borrowings in July, with ₹ 96,769 crore allotments made through state development loans (SDLs), as they sought to fast-track capital spending and inject momentum into economic growth. This was well above the ₹ 68,383 crore allotted in July last year, according to the latest data from the Reserve Bank of India (RBI). The data showed that state borrowings, in terms of allotments through SDL, climbed steadily through the first four months of FY26, from ₹ 52,870 crore in April to ₹ 64,722 crore in May and ₹ 82,207 crore in June, before peaking in July. The borrowing surge breaks from the usual pattern, where states typically backload SDL issuances in the second half of the fiscal year. Typically, state governments tap low-cost or interest-free funds in the first half of the fiscal year, including their tax revenues, central tax devolution, GST compensation, and interest-free loans from the Centre, before turning to costlier market borrowings. Instead, with the Centre accelerating infrastructure outlays and global headwinds threatening the economic outlook, states now appear to be front-loading borrowings to kickstart projects early. The trend contrasts sharply with the same period last year, when monthly borrowings were far lower. To be sure, state governments raised ₹ 2.97 trillion through market borrowings between April and July in FY26, up sharply from ₹ 2.14 trillion in the same period last year, underscoring an aggressive front-loading of debt to fund development and infrastructure projects. SDLs are bonds issued by state governments to raise funds for development projects and manage fiscal gaps. Proceeds typically finance infrastructure, welfare schemes, and other public spending priorities. Auctioned by the RBI on behalf of states, SDLs are a key source of long-term financing for subnational budgets and a vital tool for sustaining state-led growth initiatives. As things stand, state governments and Union territories are projected to raise ₹ 2.87 trillion through SDLs in the July–September quarter, higher than the ₹ 2.6 trillion in the year-ago period, the RBI data showed. Experts said the move signals a coordinated fiscal push to anchor growth amid geopolitical and trade-related uncertainties, as well as weak private-sector capital expenditure. At the latest SDL auction held on 5 August, states were allotted a total of ₹ 26,750.018 crore. Maharashtra led the latest SDL auction, mobilising a substantial ₹ 6,000 crore, showcasing robust investor confidence in its long-term bond issuances. Following closely, Andhra Pradesh, Madhya Pradesh, and Telangana each mobilised ₹ 5,000 crore, reflecting their strong market participation and diverse tenors across securities. Tamil Nadu secured ₹ 4,000 crore, demonstrating steady demand for its mix of short- and long-term bonds. Telangana, capitalising on consistent investor interest, was allotted ₹ 5,000 crore across its suite of securities with maturities ranging from 19 to 24 years.
