Indian Market Remains Closed for Republic Day: What Global Investors Should Monitor

Indian stock markets are not operational today as the nation observes Republic Day, with both currency and equity trading halted for the holiday. However, commodity derivatives trading will proceed during the evening session according to exchange schedules. This market closure comes at a critical time as investors worldwide assess multiple risk factors affecting global financial conditions.

Recent Market Performance and Indian Market Weakness

The Indian market experienced significant pressure in the previous week, with major benchmarks Sensex and Nifty both declining over 2 percent. This sharp correction resulted in investors losing more than Rs 16 lakh crore in market value. The weakness in Indian markets reflects broader concerns, particularly the rupee’s depreciation to record lows against the dollar, driven by persistent foreign fund outflows from Indian equity markets. Meanwhile, a significant development looms with the India-European Union free trade agreement anticipated for announcement on January 27 after nearly two decades of negotiation.

Global Risk Factors Shaping Market Sentiment

Several geopolitical and trade-related concerns are keeping investors on alert worldwide. The U.S. has suggested potential removal of additional 25 percent tariffs on India as Russian oil imports decline, offering some relief on the trade front. However, renewed tariff tensions emerged when U.S. President Donald Trump threatened 100 percent tariffs on Canadian exports if Canada pursues trade agreements with China. Canadian leadership has clarified that no such deal with China is under consideration, addressing investor concerns about trade fragmentation.

Escalating Iran-U.S. tensions have also rattled markets as American warships advance toward the region. Reports indicate Iran’s Supreme Leader has reportedly moved to undisclosed locations, while Iranian authorities have displayed warnings against military intervention in Tehran. Additionally, U.S. political developments pose another risk, with Democratic senators threatening to block federal funding bills, raising shutdown risks that could impact market confidence.

Performance Across Major Trading Centers

Asian markets generally declined this morning following the second consecutive weekly loss for all three major U.S. benchmark indexes. In the United States, markets finished with mixed results on Friday. The Dow fell 0.6 percent, while the S&P 500 edged marginally higher and the Nasdaq Composite gained 0.3 percent. These movements reflected conflicting signals—easing concerns over Greenland offset by disappointing guidance from chip maker Intel regarding first-quarter revenue, alongside escalating geopolitical tensions.

European markets also demonstrated modest weakness, with the pan-European Stoxx 600 declining 0.1 percent to end a five-week winning streak. Germany’s DAX managed a slight 0.2 percent gain while France’s CAC 40 and the U.K.'s FTSE 100 both finished marginally lower. The region’s performance reflected weighing regional economic data against renewed U.S. trade threats.

Commodity Markets and Safe-Haven Demand

Gold prices continued their upward trajectory, surpassing $5,000 per ounce for the first time in trading history and climbing toward $5,100 per ounce during early Asian trading sessions. This milestone reflects increased safe-haven demand amid geopolitical uncertainties. Oil prices remained relatively flat after gaining more than 2 percent in the previous session.

With Indian market remaining closed through the Republic Day holiday, investors will be watching for resumption of trading and how accumulated global developments may influence Indian market sentiment when operations resume.