Indian Stock Market Remains Steady as New US President Stays Away from Tariffs on Inauguration Day
Click to start listening
Synopsis
On January 21, the Indian stock market showed minimal movement, influenced by positive trends in Asia after Donald Trump assumed the presidency without imposing expected trade tariffs. The Nifty 50 and BSE Sensex experienced slight increases, while market analysts await further clarity on Trump's economic policies.
Key Takeaways
- Indian benchmark indices traded flat.
- Trump's inauguration saw no immediate tariffs imposed.
- Nifty IT and Pharma sectors led gains.
- Market analysts expect gradual tariff implementation.
- FIIs sold equities, while domestic investors bought.
Mumbai, Jan 21 (NationPress) Indian benchmark indices exhibited a nearly flat performance on Tuesday morning, reflecting gains across Asia, following Donald Trump's inauguration as the 47th President of the United States, who opted not to enforce anticipated trade tariffs immediately.
The Nifty 50 showed a rise of 0.25 percent, while the BSE Sensex, comprising 30 stocks, increased by 0.09 percent as of 9:18 a.m. In pre-open trading, the S&P BSE Sensex Index climbed by 188 points, or 0.24 percent, reaching 77,261, and the NSE Nifty 50 was up by 76 points, or 0.33 percent, at 23,421.
Market analysts noted that Trump 2.0 has commenced without much insight into his forthcoming economic strategies.
While his inaugural speech was explicit regarding immigration, it lacked clarity on tariffs. The potential for a 25 percent tariff on Canada and Mexico implies that any increase in tariffs will likely occur gradually.
The currency market saw a decrease in the dollar index to 108.43, and the yield on 10-year bonds fell to 4.54 percent.
Experts commented, “This situation exemplifies the principle of ‘buy on rumors and sell on news.’ Delays in tariff increases could weaken the dollar and lower bond yields, which would positively impact emerging markets like India.
Of the 12 sectors on the NSE, seven advanced, with Nifty IT and Nifty Pharma leading the gains on Tuesday, while Nifty Realty and PSU Bank faced the most significant declines in early trading.
The broader market followed suit with larger counterparts, as the BSE midcap index rose by 0.21 percent and the smallcap index increased by 0.51 percent.
However, seven out of the 20 sectors tracked by BSE experienced declines, with consumer durables and realty sectors showing the most significant drops.
Market analysts mentioned that after a positive start, the Nifty could find support at 23,250, followed by 23,100 and 23,000. On the upside, immediate resistance might occur at 23,400, followed by 23,500 and 23,700.
On January 20, foreign institutional investors (FIIs) sold equities amounting to Rs 4,336 crore, while domestic institutional investors purchased equities worth Rs 4,322 crore.
