Stock markets end with gains
Muscat: Stock markets in the Gulf region, including Oman, India and Asia closed higher on Tuesday, recovering from global selling on hopes that the United States is willing to negotiate some significant import tariffs.
However, on Monday, major stock indices had plunged mainly due to the impact of reciprocal tariffs imposed by China.
Speaking to Times of Oman, R. Madhusoodanan, a former SBI official and financial expert said, the reasons attributed to the steep fall are both global and domestic. The global markets have taken cues from the fall of stocks in Wall Street, he said. The Trump administration's announcement of higher tariffs has not been taken positively by the investors across the globe including that of the US, he added.
All the economies of the world including emerging markets (EM) are very much concerned about the outcome, he said.
This has created a panic and uncertainty in the global trade. The global investing community is more worried about the unpredictable announcements of the US administration, he said.
Federal Reserve Chair Jerome Powell has remarked that the proposed tariffs are 'larger than expected'. The experts predict a global recession.
This Fear of a looming recession coupled with high inflation and interest rates in the US can adversely affect the economic growth of the US in the short term to medium term horizon. This was one of the reasons for tumbling of the US stocks.
The US Dollar Index (DXY) , which is a measure of the strength of the US dollar against a basket of major currencies, is also down at 102.88 levels.
The retaliatory tariffs imposed against the US products by countries like China, Mexico and Canada is another reason. The industries in the US too are affected in the tariff war. The US dairy product export is over $8 billion annually.
China and Mexico have already hiked the tariffs on dairy products of the US, which made the industry in uncertainty Madhusoodanan added.
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