BNP Paribas: The Indian stock market is unlikely to receive a significant boost from the EU agreement

Glonghui, January 28｜William Bratton of BNP Paribas stated that the EU-India Free Trade Agreement is unlikely to have a significant impact on the sentiment of the Indian stock market. In a report, he wrote that while the agreement is a positive development, direct exports abroad are not a major driver of Indian corporate profits, thus the impact of the agreement is limited. For improvement to occur, the factors currently driving the market's underperformance need to be addressed. Bratton listed these factors as: a lack of investment themes, India's potential as an alternative to Chinese manufacturing is weakening, and sluggish macroeconomic momentum is dragging down profit expectations. Since July 2025, foreign investors have been net sellers of Indian stocks every month, and Bratton expects this trend to continue as the trade agreement with the United States remains unresolved and uncertainty persists.