Market turmoil under uncertainties of potential Trump policies

Foreign markets are jittery over the potential actions of Donald Trump if he becomes the US President. Microchip and technology stocks tumbled yesterday, leading to a morning crash in Asian markets. This trend could extend to India, though budget expectations might provide some market support. The IMF's upward revision of India's growth forecast may also help the market.

Earnings reports fall short

Asian Paints and Mindtree published underwhelming results. Several major companies will release their results today and tomorrow, but cement companies are not expected to show significant profit growth.

Derivatives market movements

In the derivatives market, the Gift Nifty closed at 24,662 on Tuesday night and opened at 24,670 this morning, indicating a modest start for the Indian market. European markets declined on Tuesday and Wednesday. The US stance on imposing additional tariffs on companies supplying restricted technology to China dropped Dutch microchip company ASML by 11%.

US market fluctuations

The US market soared on Tuesday, with the Dow Jones rising by 742.76 points (1.85%). However, tech stocks plummeted on Wednesday, causing the Nasdaq to fall. Concerns over Trump’s policies hit microchip companies hard, particularly those manufacturing in China, which is responsible for 90% of microchip production. Companies like Nvidia, TSMC, and ASML dropped by over 5%.

Global markets

On Wednesday, the Dow Jones closed up 243.60 points (0.59%) at 41,198.08. The S&P 500 fell by 78.93 points (1.39%) to 5588.27, and the Nasdaq dropped by 512.41 points (2.77%) to 17,996.92. US futures indicated slight gains today, with the Dow up by 0.13%, S&P by 0.18%, and Nasdaq by 0.33%.

Asian markets opened lower today, with Japan's Nikkei down by 1% and Chinese markets also declining.

Indian market 

The Indian market surged on Tuesday but closed with minor gains. The Sensex reached 86,898.30 and the Nifty climbed to 24,666.25 before declining under selling pressure. The market's rise is continuing but with a weakening momentum. Sectors like realty, FMCG, IT, and auto are supporting the market.

The Sensex closed up 51.69 points (0.06%) at 80,716.55, and the Nifty rose by 26.30 points (0.11%) to 24,613.00. The Bank Nifty closed down 0.11% (59.10 points) at 52,396.80. The mid-cap index remained unchanged at 57,664.00, while the small-cap index rose by 0.08% to 19,062.40.

Foreign investment and market support levels

Foreign investors bought shares worth ₹1271.45 crore in the cash market on Tuesday, while domestic funds and institutions sold shares worth ₹529.48 crore. Today’s focus will be on whether the Nifty can surpass 24,700, with the next target being 25,000. The index has support at 24,590 and 24,550, with resistance at 24,650 and 24,695.

Gold fluctuations

Gold prices hit a record on Tuesday, closing at $2481.10 an ounce. Fed Chairman Jerome Powell's statement about being ready to cut rates supported the rise, pushing gold towards $2500 an ounce. However, selling pressure caused gold to dip to $2458.80 an ounce yesterday. This morning, it rose to $2461 an ounce.

In Kerala, gold prices surged by ₹720 to ₹55,000 per sovereign on Tuesday, nearing the record price of ₹55,120 set on May 20. Prices may decline slightly today.

Silver is at $30.35 an ounce, with Kerala prices at ₹99,000 per kilogram.

Dollar index and rupee movements

The dollar index rose to 104.27 on Tuesday but fell to 103.75 yesterday. Trump's weak dollar stance contributed to this decline, with the index at 103.74 this morning. The rupee slightly improved on Tuesday, with the dollar closing at ₹83.58, down by two paise.

Crude oil and industrial metals

Crude oil prices fluctuated, with Brent falling below $84 before rebounding. It closed up 1.5% at $85.08 yesterday, driven by a weaker dollar. This morning, it rose to $85.43. WTI is at $83.32, and UAE's Murban crude is at $84.59.

Industrial metals are weak, despite increased production in China, due to GDP growth falling below expectations. Copper fell by 0.34% to $9533 per tonne, and aluminium dropped by 0.50% to $2401.85 per tonne.

Cryptocurrencies

Cryptocurrencies surged before a slight decline, with Bitcoin nearing $66,000 before falling to $64,700. Ethereum dropped to $3420.

Market indicators (16 July 2024, Tuesday)

• Sensex 30: 80,716.55 (+0.06%)
• Nifty 50: 24,613.00 (+0.11%)
• Bank Nifty: 52,396.80 (-0.11%)
• Mid Cap 100: 57,664.00 (0.00%)
• Small Cap 100: 19,062.40 (+0.08%)
• Dow Jones 30: 40,954.48 (+1.85%)
• S&P 500: 5667.20 (+0.64%)
• Nasdaq: 18,509.34 (+0.20%)
• Dollar ($): ₹83.58 (-₹0.02)
• Gold (ounce): $2481.10 (+$58.50)
• Gold (sovereign): ₹54,280 (+₹280)

Market indicators (17 July 2024, Wednesday)

• Dow Jones 30: 41,198.10 (+0.59%)
• S&P 500: 5588.27 (-1.39%)
• Nasdaq: 17,996.90 (-2.77%)
• Dollar index: 103.75 (-0.52)
• Gold (ounce): $2458.80 (-$22.30)
• Gold (sovereign): ₹55,000 (+₹720)
• Crude (Brent) oil: $85.19 (+$1.46)