- Sensex, Nifty: Stock market indices Sensex and Nifty took a beating, falling over 1 per cent in Thursday’s trade and, thus eroding all the gains that they made the previous session on the Trump trade. Stocks fell, as concerns over weak Q2 earnings and high valuations came back to haunt investors. Also, a Trump victory means fewer Fed cuts. The FOMC will conclude its two-day policy review today.
Indian stock market News Today
Despite hopes that Donald Trump as the next US President would cut US corporate rates and improve US spending, it is believed that market volatility will only increase in his tenure.
The BSE Sensex was trading 848.48 points, or 1.06 per cent, lower at 79,529.65, with selling in private lenders such as ICICI Bank, HDFC Bank, oil-to-telecom major Reliance Industries Ltd and IT major Infosys Ltd contributing most to its fall. Nifty also fell 276 points or 1.13 per cent to 24,208.
Kotak Securities said its finds several contradictions in the ‘Trump’ trade. It said while corporate tax cuts in the US may result in higher earnings and spending on IT services but they will also result in higher fiscal deficits (if unfunded) and dollar weakness in the medium term. Higher import tariffs will result in higher inflation and interest rates and lower growth in the US, it said adding that ‘America First’ policy may limit outsourcing and impose fresh restrictions on visas. Lastly, a likely anti-ESG approach may not be positive for a portion of India’s exports of solar PV modules, the brokerage said.
“The ‘Trump trade’ which has sharply lifted the US markets overnight is unlikely to have a similar positive impact in India since Indian market valuations are high and there are headwinds of an earnings slowdown. Investors should stick to quality and value during this period of euphoria and uncertainty,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Nomura said tariffs and tax policy will be the focus for economic policy early in a second Trump administration. Tariffs are likely to be inflationary and negative for growth, it said.
- “We now expect just one Fed cut in 2025, with policy on hold until the realised inflation shock from tariffs has passed. We expect some additional easing in 2026, but have raised our terminal rate forecast to 3.625 per cent from 3.125 per cent. The fiscal outlook will likely deteriorate under unified government,” it said.
“The ‘Trump trade’ which has sharply lifted the US markets overnight is unlikely to have a similar positive impact in India since Indian market valuations are high and there are headwinds of an earnings slowdown. Investors should stick to quality and value during this period of euphoria and uncertainty,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Nomura said tariffs and tax policy will be the focus for economic policy early in a second Trump administration. Tariffs are likely to be inflationary and negative for growth, it said.
“We now expect just one Fed cut in 2025, with policy on hold until the realised inflation shock from tariffs has passed. We expect some additional easing in 2026, but have raised our terminal rate forecast to 3.625 per cent from 3.125 per cent. The fiscal outlook will likely deteriorate under unified government,” it said.
PhillipCapital said Nifty has fallen by 8 per cent from its recent peak owing to massive FII outflows and concerns on growth slowdown. The brokerage remained structurally positive on Indian economy and equities and advised investors to use these dips as buying opportunity.
Incorporating the Trump win, likes banks such as ICICI Bank, Axis Bank, HDFC Bank and SBI; NBFCs such as Muthoot Finance, Shriram Finance, Bajaj Housing Finance; and IT stocks such as Infosys, LTI Mindtree and Coforge.
Among industrials, it likes L&T, Siemens, Cummins. The brokerage prefers BEL, Data patterns and HAL in the defence sector. It likes NMDC, Nalco and SAIL in metals; Ultratech, JK Cement and Ambuja Cements in the cement sector.
Trump Game Changer
Trump’s campaign for re-election has been marked by ambitious promises that touch on issues from economic revitalisation to foreign policy recalibration. Among his key pledges are reducing America’s reliance on foreign manufacturing, confronting China more aggressively, and restoring “law and order” through tougher immigration policies and domestic security measures. He has also suggested expanding tariffs to encourage US self-sufficiency and creating new incentives for American businesses to invest domestically rather than abroad. Observers worldwide will be keen to see if Trump, once back in office, will follow through on these promises or face practical and political challenges that may temper his goals. The challenge of balancing bold rhetoric with effective governance will shape the perception of his second term, especially as global markets, allies, and adversaries alike assess whether he can deliver on his campaign’s strong nationalist tone.
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