Late on April 2, US President Donald Trump announced tariffs on more than 180 countries in the world, including India, in which India has been imposed 27% tariff on India. Some sectors are exempted from the US tariff, but some have been imposed heavy tariffs like 25% tariff will be applied on the auto sector. Now the biggest question is that despite imposing 27% tariffs on India, why is it not visible on the stock market?
The BSE top 30 -share Sensex is trading at 76287 by falling 331 points. Talking about Nifty, it is 80 points to 23252 points. The Nifty Bank is trading in the Green Zone and has gained more than 200 points. This decline is not as big as expected before the expert Trump’s tariff. This decline is showing a good status of the Indian market. Let us know the five reasons that did not cause heavy fall in the market.
Why didn’t the stock market not fall too much?
- In a conversation with Business Today Television, independent market expert Nischal Maheshwari said that money should be withdrawn in India by withdrawing money from Global Market. India is a quite a safe economy, which provides a margin of security to investors. It has become a top performance economy.
- Saying a similar thing, Manish Sonthalia, director and chief investment officer of Emkey Investment Managers, said that China has been charged a heavy duty compared to India, which makes it a golden ‘China plus forest’ opportunity for India to increase its trade with America.
- He said in a conversation with Business Today Television, “We have a clear lead compared to China, Vietnam, Thailand and Indonesia. US dollar is going to decline and Indian rupee is going to improve. FIIs have been big sellers and Indian markets provide a lot of opportunities with high growth. Nothing is tension for India.”
- US President Donald Trump imposed a mutual fee of 27 percent on India, while China was charged a 34 percent fee. Other Asian economies including Japan, Vietnam, South Korea and Taiwan were charged up to 46 percent. This step can increase inflation in America, there may be a consumer demand and the economy can move towards recession in us economy. In such a situation, there are good signs for India.
- Maheshwari said that no other major economy like India does not have more than 6 percent real GDP growth, while there is a huge uncertainty in the global markets. On the other hand, the Government of India is clear compared to other economies. RBI is supporting the economy and businesses with raising rates and increasing liquidity. The next policy to be held in April is expected to cut rates.
American tariff is not harmful to India
He warned that American tariffs are not as negative for the Indian Stock Market, but should not be hurried. After the tariff, India is in the front line, but it is too early to be happy. India will be limited by India exports and increasing manufacturing.
Investors were scared of preopen market
The fall of 3,000 points in Sensex in the preopen market would have increased the concern of investors, but the domestic stock market did not fall much after the initial response to the US tariff.
Amidst trade fee concerns, Indian stock markets saw good recovery on Thursday. The BSE Sensex rose about 690 points from the day -to -day level to 76,494 points, while the Nifty 50 index gained more than 160 points from its intraday low to 23,306.50 points.
These reasons for not falling too much
It is being said that it is a good sign for India to give discounts in some sector. Which includes pharma, metal, jewelery and other sectors. Nirmal Bang Institutional Equities said that a possible Indo-US trade agreement may solve some issues related to the fee and market access between the two sides. At the same time, India is also committed to more purchases of crude oil, defense etc. from America. The pharma region was exempted, but no additional fee was imposed by the US on the steel and aluminum sector.