Indian stock market: Despite multiple rounds of discussion between the US and India, President Donald Trump announced a 25% tariff on Wednesday ahead of the August 1 deadline, which, according to analysts, is likely to spark a knee-jerk reaction when the Indian stock market opens for trading tomorrow, July 31.
The signs of an impending volatile session were already visible, as Gift Nifty futures saw a sharp decline after Trump slapped higher-than-expected tariffs on India, signalling some stalemate in the ongoing negotiations between the two nations.
Gift Nifty futures plunged sharply to 24,678, and were last trading down 160 points, or 0.63%, at 24,700, signalling a gap-down opening for the Indian stock markets on Thursday.
Analysts had signalled that a rate of 20% or higher would come as a disappointment for India, which had been seeking a better deal than the 19% that Trump offered Indonesia and the Philippines.
Trump tariffs: How will Indian stock market react?
Anirudh Garg, Fund Manager at INVasset PMS, said a knee-jerk reaction is quite possible tomorrow — partly due to Trump’s 25% tariff announcement, and partly because it coincides with the monthly expiry.
“On expiry days, volatility tends to spike as traders roll over positions and settle futures and options contracts. With Gift Nifty already reacting negatively, we could see that sentiment spill over into domestic markets at the open,” Garg added.
