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Business Standard
15-05-2025
- Business
- Business Standard
Markets zoom after Trump remarks; Nifty settles above 25K after 7 months
Benchmark indices on Thursday gained amid hopes that the reciprocal tariffs imposed by the United States (US) will be minimal after American President Donald Trump said India had offered a zero-tariff trade deal. The BSE Sensex ended the session at 82,531, gaining 1,200 points or 1.5 per cent. The Nifty 50 closed above 25,000 after seven months, ending the session at 25,062, with a gain of 395 points or 1.6 per cent. On the BSE, listed firms' market capitalisation rose ₹5.3 trillion to ₹440 trillion. Trump said on Thursday India had offered to drop tariffs on US goods. India was among the first countries to begin negotiations with the US after Prime Minister Narendra Modi's visit to the country in February. 'The markets were looking for some good news from somewhere. Earlier during the week, the markets celebrated the cessation of hostilities between India and Pakistan, followed by a slump after the US-China trade tariff truce. The markets are looking at Trump's claim as a solution to tariff issues with the US and better trade terms. Tariff talks take months, and it will take time before we know the nuances. For now this seems more like a short covering rally,' said U R Bhat, cofounder of Alphaniti Fintech. Some experts said zero tariffs from India would lead to zero or near-zero tariffs on the part of the US on Indian products. 'It will be a win-win situation because the US does not have a cost advantage in most products we specialise in. American imports are mostly luxury products. Zero tariffs will not substantially impact the Indian economy,' said Chokkalingam G, founder of Equinomics. Indian equities had a roller coaster week, which began with cheer on ceasefire with Pakistan after the worst conflict in more than 50 years. However, the cheer was short-lived after the US and China agreed to slash reciprocal trade tariffs for 90 days. Investors fear the easing of trade tensions could divert foreign flows away from India. In April, India had emerged as a haven amid global trade uncertainties, attracting foreign investment. The rest of the corporate results and the sustainability of ceasefire between India and Pakistan will determine the market trajectory. 'The markets will be trading within a range with a negative bias,' said Bhat. All sectoral indices gained, while the India Vix (volatility) index cooled 2 per cent. Market breadth was strong with 2,615 stocks advancing and 1,350 declining. All Sensex stocks except one gained. Reliance Industries rose 2.1 per cent and was the biggest contributor to Sensex gains, followed by ICICI Bank, which rose 1.8 per cent. 'A decisive breakout above 25,200 could take the index towards the 25,400 zone. We continue to advocate a 'buy on dips' strategy, with strong emphasis on selective stock picking, especially in the light of overbought conditions in certain segments,' said Ajit Mishra, senior vice-president (research), Religare Broking.
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Business Standard
08-05-2025
- Business
- Business Standard
Can Sensex, Nifty crash and hit lower circuit as India, Pak tensions rise?
Indian markets are set to witness a gap-down opening on Friday as geopolitical tensions between India and Pakistan escalated post market hours on Thursday. The developments, analysts believe, can take the markets sharply lower on Friday, but they rule out the possibility of Sensex and the Nifty 50 indices hitting their respective lower circuit filters. 'The markets will see a major dent on Friday though a lower circuit at this stage is ruled out. The Nifty, in my opinion, will see a cut of over 500 points, and the Sensex could crash by nearly 2,500 – 3,000 points in case the geopolitical tension escalates with Pakistan. What can save the day for the markets is a formal statement from the authorities on the ground situation about the damage, which can possibly assuage investors. The uncertainty is creating more panic in the markets,' said Ambareesh Baliga, an independent market expert. Pakistan, the reports suggest, attempted to engage military sites in northern and western India — including Awantipura, Srinagar, Jammu, Amritsar, Ludhiana, and Bhuj — between May 7 and 8. The Pakistani offensive, involving drones and missiles, was thwarted. The geopolitical development took Gift Nifty lower by 1.3 per cent, or nearly 300 points at 10PM IST on Thursday to 23,900 levels. "What happens from here on the geopolitical front between India and Pakistan is anybody's guess. This uncertainty will keep the markets on tenterhooks and can take the Nifty down by another 5 per cent from the current levels despite what is happening in the global markets. India, Pakistan is a localised event as far as the other global cues are concerned," said U R Bhat, co-founder & director, Alphaniti Fintech. For the Nifty 50 index to hit the lower circuit, it has to fall 10 per cent to 21.846.20 levels on Friday. If this becomes a reality before 1 PM, then the trading will be halted for 45 minutes. If the 10 per cent lower circuit is hit between 1 PM and 2.30 PM, the trading will then be halted for 15 mins, and if the 10 per cent circuit is hit after 2.30 PM, it will not impact trading, as per the exchange rules. Key Nifty and Sensex levels to watch Nifty 15 per cent lower circuit at 20632.73 If the Nifty hits 15 per cent lower circuit before 1 PM then the trading will be halted for 1 hour & 45 mins. If 15 per cent circuit is hit between 1 PM - 2 PM, trading will be halted for 45 mins If 15 per cent circuit is hit after 2 PM, trading will be suspended for the remainder of the day. In case the Nifty hits the 20 per cent lower circuit (19419.04 levels) anytime during the day, trading will be suspended for the remainder of the day, stock exchange rules say. Nifty lower circuit levels; Source: NSE Similarly, for the Sensex, here are the key levels to track: 10 per cent - 72301.329 15 per cent - 68284.5885 20 per cent - 64267.848 "I do not think that the markets (Sensex and the Nifty 50) will hit their respective lower circuits tomorrow, but a sharp fall is expected. Among the lot, I expect the mid-and small-cap segments to be impacted the most. At an index level, both midcap and smallcap indexes can slip by around 5 per cent each, with select stocks from these segments suffering much deeper cuts of over 10 per cent," said G Chokkalingam, founder and head of research at Equinomics Research.
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Business Standard
07-05-2025
- Business
- Business Standard
Operation Sindoor: Prolonged strikes can sink markets, say analysts
A prolonged war / tension with Pakistan post Operation Sindoor – the retaliatory attack by Indian armed forces on Pakistan and Pakistan Occupied Kashmir (PoK) – could 'sink' markets, suggest analysts. However, they could see a recovery in due course if the measures are limited only to select targets and the tensions de-escalate, they said. History, Aniruddha Sarkar, chief investment officer at Quest Investment Advisors said, suggests that Indian markets have most of the times done well during and even after any conflict with Pakistan on the borders. This time is no different. 'Though the geopolitical concerns have been there for the last two weeks, yet foreign institutional investor (FII) inflows continued into our markets, which is a stamp of our economic resilience to these short-term border conflicts. Any military campaign which would be limited to selected targets and be over within a few days or weeks, would not have any negative impact on our economy or markets. Prolonged conflict, which seems unlikely at this moment, could impact investor sentiment negatively as they would prefer a risk off mode,' Sarkar said. In the intervening night of May 6 and May 7, Indian armed forces carried out strikes on terrorist infrastructure in Pakistan and Pakistan-occupied Jammu and Kashmir (PoJK) in response to the terrorist attack in Pahalgam on April 22 that left 26 civilians dead. Historically, Indian equity markets have typically reacted sharply to geopolitical tensions in the short-term as a knee-jerk, but recovered quickly once uncertainties subsided. For example, during the Kargil conflict between India and Pakistan in mid-1999, markets experienced a significant correction. However, they rebounded strongly as it became evident that the conflict would be short-lived. Ambareesh Baliga, an independent market analyst, too, feels that if Operation Sindoor remains localised within a band / territory with targeted strikes and ends soon, the markets could witness a smart recovery. 'In case the current conflict widens, the uncertainty will sink the market. As of now it would be a wait-and-watch strategy. Post Balakot also, we witnessed a smart move up in the markets,' he said. The information available till now on Operation Sindoor has been digested by the markets, feels U R Bhat, co-founder & director, Alphaniti Fintech. For the markets to stabilize, he feels, more information is needed on how Pakistan is likely to react to the developments. "The markets are waiting with bated breath and are likely to remain volatile. While the available information has been digested by the markets, any escalation in the tensions will see them spiral down. As a strategy, investors should sell the rallies till there is truce and more clarity on the developments," he said. Within the market segments, G Chokkalingam, founder and head of research at Equinomics Research, said small-and mid-cap segments may underperform the large-caps as retail investors' participation seems to be weak due to geopolitical developments. "Till intense tensions on border moderates, we suggest some tilt towards large-caps, especially the Sensex and Nifty stocks. Of course, if there is any escalation or war with Pakistan, then the whole market, including large-caps may see a substantial fall," he warns.
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Business Standard
07-05-2025
- Business
- Business Standard
Operation Sindoor impact: Prolonged strikes can sink markets, say analysts
Historically, Indian equity markets have typically reacted sharply to geopolitical tensions in the short-term as a knee-jerk, but recovered quickly once uncertainties subsided New Delhi A prolonged war / tension with Pakistan post Operation Sindoor – the retaliatory attack by Indian armed forces on Pakistan and Pakistan Occupied Kashmir (PoK) – could 'sink' markets, suggest analysts. However, they could see a recovery in due course if the measures are limited only to select targets and the tensions de-escalate, they said. History, Aniruddha Sarkar, chief investment officer at Quest Investment Advisors said, suggests that Indian markets have most of the times done well during and even after any conflict with Pakistan on the borders. This time is no different. 'Though the geopolitical concerns have been there for the last two weeks, yet foreign institutional investor (FII) inflows continued into our markets, which is a stamp of our economic resilience to these short-term border conflicts. Any military campaign which would be limited to selected targets and be over within a few days or weeks, would not have any negative impact on our economy or markets. Prolonged conflict, which seems unlikely at this moment, could impact investor sentiment negatively as they would prefer a risk off mode,' Sarkar said. In the intervening night of May 6 and May 7, Indian armed forces carried out strikes on terrorist infrastructure in Pakistan and Pakistan-occupied Jammu and Kashmir (PoJK) in response to the terrorist attack in Pahalgam on April 22 that left 26 civilians dead. Historically, Indian equity markets have typically reacted sharply to geopolitical tensions in the short-term as a knee-jerk, but recovered quickly once uncertainties subsided. For example, during the Kargil conflict between India and Pakistan in mid-1999, markets experienced a significant correction. However, they rebounded strongly as it became evident that the conflict would be short-lived. Ambareesh Baliga, an independent market analyst, too, feels that if Operation Sindoor remains localised within a band / territory with targeted strikes and ends soon, the markets could witness a smart recovery. 'In case the current conflict widens, the uncertainty will sink the market. As of now it would be a wait-and-watch strategy. Post Balakot also, we witnessed a smart move up in the markets,' he said. The information available till now on Operation Sindoor has been digested by the markets, feels U R Bhat, co-founder & director, Alphaniti Fintech. For the markets to stabilize, he feels, more information is needed on how Pakistan is likely to react to the developments. "The markets are waiting with bated breath and are likely to remain volatile. While the available information has been digested by the markets, any escalation in the tensions will see them spiral down. As a strategy, investors should sell the rallies till there is truce and more clarity on the developments," he said. Within the market segments, G Chokkalingam, founder and head of research at Equinomics Research, said small-and mid-cap segments may underperform the large-caps as retail investors' participation seems to be weak due to geopolitical developments. "Till intense tensions on border moderates, we suggest some tilt towards large-caps, especially the Sensex and Nifty stocks. Of course, if there is any escalation or war with Pakistan, then the whole market, including large-caps may see a substantial fall," he warns.
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Business Standard
25-04-2025
- Business
- Business Standard
Markets expect an escalation in India-Pakistan tensions, say analysts
Markets expect an escalation in India – Pakistan tensions following the attack on civilians in Pahalgam, but a full-fledged war between the neighbouring countries is ruled out at this stage, suggest analysts. The markets, according to U R Bhat, co-founder & director, Alphaniti Fintech, are quite nervous after the developments in Pahalgam. The markets, he said, had gone up sharply from their recent fall that was triggered by US tariff fears. Investors, Bhat believes, are booking profit now and preferring to wait on the sidelines till there is clarity on the India – Pakistan geopolitical situation. "Investors are nervous due to the developing geopolitical situation with Pakistan after the Pahalgam attack. Markets expect an escalation in the tensions between India and Pakistan, and there is no doubt about this. Now, how and how fast will India retaliate to the developments is anybody's guess. Given this, investors are keeping their positions light,' Bhat said. In the aftermath of the Pahalgam attack that left 26 dead earlier this week, India has launched a series of retaliatory measures targeting Pakistan's diplomatic and strategic interests, which includes expulsion of Pakistani military attachés, closing the Attari border, and suspending the Indus Waters Treaty. Pakistan Army troops, according to reports, opened fire at multiple locations along the Line of Control (LoC) in Jammu and Kashmir on Thursday night. At the bourses, meanwhile, the Sensex lost over 800 points in intraday deals to hit a low of 78,797 levels on Friday. From a level of 78,017.19 on March 25, 2025, it had tanked 6,592 points, or 8.4 per cent, to 71,425 on April 7, 2025 on tariff fears. TRACK LIVE UPDATES HERE The 90-day push-back on tariffs by US president Donald Trump triggered a rally in the markets and took the Sensex 8,829.55 points, or 12.4 per cent higher to 80,254.55 levels by Wednesday, April 23. Lessons from history Historically, equity markets have generally seen a knee-jerk reaction on account of geopolitical risks in the near-term, but have found their feet soon. The Kargil confrontation between India and Pakistan, for instance, saw a sharp market correction in mid-1999. However, the markets rallied sharply as realisation dwelled that the conflict would not last long. CHECK HERE The recent developments between India and Pakistan, said G Chokkalingam, founder and head of research at Equinomics Research, are likely to keep the markets on the edge with chances of a further fall from here on amid volatility. "While investors should remain cautious and monitor the developments, there is not much need to panic at this stage. A full-fledged war is ruled out, but tensions, the markets feel, between India and Pakistan will rise. The markets should be able to live with that and will eventually bounce back, as seen in the past as well. As an investment strategy, investors should buy the dips from a long-term perspective. I am bullish on the banking sector," Chokkalingam said.
