US President Donald Trump has signalled a potential reduction in tariffs imposed on neighbouring countries, providing a slight relief in global markets. The details of this are expected to be revealed later tonight. There are also new developments regarding the Ukraine issue. Significant announcements are anticipated during Trump's speech at the joint session of the US Congress. Market trends are heavily reliant on Trump's words and actions.
The Indian market struggled to recover yesterday, but the overall market sentiment has not yet lost optimism. If a resolution in the trade war is reached, it could lead to a significant market rally.
In the derivatives market, the Gift Nifty closed at 22,081.50 on Thursday. This morning, it reached 22,130, indicating that the Indian market may open in the red today.
European markets experienced a significant drop on Thursday. The combination of Trump’s trade tariffs and the halt in military aid to Ukraine led to a more than 3% decline in the markets.
The US markets also faced a downturn on Thursday. Trump’s trade war had a severe impact on the market, with the Dow Jones losing over 1300 points in two days. The S&P 500 reverted to the levels seen before Trump’s victory. JP Morgan has evaluated that the trade war will not only increase inflation but also lead to an economic recession.
After the trading hours, Commerce Secretary Howard Lighthizer stated that a resolution would be reached with Canada and Mexico regarding tariffs. He expressed hope that an agreement could be made public by Wednesday. Following this announcement, the futures market showed a positive bounce.
On Thursday, the Dow Jones Index dropped 670.25 points (1.55%) to close at 42,520.99. The S&P 500 Index fell by 71.57 points (1.22%) to finish at 5778.15, and the Nasdaq Composite Index decreased by 65.03 points (0.35%) to close at 18,285.16.
US futures are showing gains this morning, with the Dow Jones up by 0.51%, the S&P 500 up by 0.63%, and the Nasdaq rising by 0.64%.
Nvidia, a chip company that had fallen by more than 15% in recent days, saw a 1.69% rise yesterday. After the trading session, the stock surged by an additional 2.2%.
Elon Musk’s Tesla dropped by 4.43% yesterday. The stock is now 45% lower from its record high a month ago and has fallen by 30% recently. Tesla's car sales have significantly dropped, and Musk's SpaceX company's Starship rocket launch was delayed due to a failure, which also impacted market sentiment.
Asian markets showed mixed trends. Japan’s Nikkei initially rose by half a percentage point but later turned negative. The Australian market dropped by 1%, while South Korea’s index gained over 1%. Hong Kong’s market surged by more than 2%, and Chinese indices saw positive gains. The Chinese parliament has set a GDP growth target of 5% for this year, the same as last year, and a 4% fiscal deficit, marking the highest deficit in 30 years.
The Indian market experienced volatility on Thursday. It began with a significant drop following global market trends but later recovered, although it ended the day with marginal losses. The Nifty 50 index fell by 36.65 points (0.17%), closing at 22,082.65. The Sensex declined by 96.01 points (0.13%), ending at 72,989.93. The Bank Nifty, however, rose by 130.90 points (0.27%), closing at 48,245.20. The Mid-Cap index gained by 0.05%, reaching 48,007.85, while the Small-Cap index rose by 0.69%, closing at 14,762.60.
On Thursday, Foreign Institutional Investors (FIIs) sold ₹3,405.82 crore worth of equities in the cash market, while domestic funds and financial institutions purchased ₹4,851.43 crore worth of stocks.
In the broader market, the advance-decline ratio turned favourable for the first time in several days. Out of 2,152 stocks that rose on the BSE, 1,804 stocks declined. On the NSE, 1,658 stocks advanced, and 1,215 stocks declined.
Despite the bearish sentiment, there is an increasing number of market participants who believe the market has bottomed out. A positive development could see the market bounce back quickly. In such a market, there could also be false rallies. Today, the Nifty is expected to find support around 22,000 and 21,960, with resistance at 22,100 and 22,190.
Gold continues to rise as the trade war intensifies, prompting more investors to seek safety in gold. Central banks are also increasing their gold reserves. The US Dollar Index dropped by about 1.5%, which pushed the price of gold above $2,900 per ounce. Goldman Sachs now predicts gold could reach $3,100 per ounce this year.
Internationally, gold prices reached $2,928 per ounce before closing at $2,917.70. However, Trump’s shift in stance on the trade war caused a slight dip in gold prices, which fell to $2,910 this morning.
In Kerala, the price of gold jewellery increased by ₹560 per gram, reaching ₹64,080 per 8 grams.
Silver rose to $32.04 per ounce.
The Dollar Index fell from 106.75 to 105.74 and is currently at 105.66.
The Indian Rupee strengthened on Thursday, closing at ₹87.27 against the US Dollar, down by 10 paise.
US Treasury bond yields dropped, leading to higher returns on investments. The yield on 10-year bonds increased from 4.12% to 4.26%.
Crude oil prices dipped, only to recover slightly. The Organisation of Petroleum Exporting Countries (OPEC) reiterated its decision to increase production in April, which contributed to the price decline. There are concerns that the trade war could dampen global economic growth, further weighing down oil prices. On Thursday, Brent crude fell to $69.75 before recovering to $71.04, and WTI crude dropped to $67.81. UAE’s Murban crude rose to $71.25.
Cryptocurrency markets saw fluctuations on Thursday. Bitcoin, which had dropped near $80,000, surged back to $87,700, while Ethereum, which had fallen to $2,020, climbed to $2,175. Price fluctuations are expected to continue in the coming days.
On Thursday, industrial metals exhibited mixed trends. Copper fell by 0.70% to $9,328.39 per tonne, while Aluminium gained by 0.06%, reaching $2,617.32. Tin increased by 1.42%, Nickel by 1.08%, Lead by 0.94%, and Zinc dropped by 0.30%.
Sensex: 72,989.93 (-0.13%)
Nifty 50: 22,082.65 (-0.17%)
Bank Nifty: 48,245.20 (+0.27%)
Mid Cap 100: 48,007.85 (+0.05%)
Small Cap 100: 14,762.60 (+0.69%)
Dow Jones: 42,521.00 (-1.55%)
S&P 500: 5,778.15 (-1.22%)
Nasdaq: 18,285.20 (-0.35%)
Dollar (₹): 87.27 (-₹0.10)
Dollar Index: 105.74 (-1.02%)
Gold (per ounce): $2,917.70 (+$23.70)
Gold (per gram): ₹64,080 (+₹560)
Crude (Brent): $71.04 (-$0.52)
