Trump's Second Term: What It Means for India and Markets

Mumbai, India: As Donald Trump begins his second term as the 47th President of the United States, Indian markets approach the day with cautious optimism. While Trump’s return to the White House previously triggered a 900-point Sensex surge in November, the spotlight is now on potential policy announcements and their impact on India.

A Wait-and-Watch Sentiment

Market experts emphasize a measured approach, focusing on India’s forthcoming Union Budget as a key market catalyst. Ace investor Vijay Kedia stated, “Trump’s policies might not be as impactful for India as anticipated. While no major anti-China or pro-India shifts are expected, the ramifications of his policies need close observation.”

Arun Kejriwal, a market veteran, echoed this sentiment, highlighting existing market concerns like Foreign Institutional Investor (FII) sell-offs and economic stress. He pointed out that potential tax cuts in the Budget could drive Indian markets more significantly than US policies.

Key Levels and the Dollar-Rupee Equation

Deven Choksey, MD of DRChoksey FinServ, noted critical support levels for the Nifty at 22,800, with a potential rally up to 24,800. “The rupee’s trajectory will heavily depend on movements in the Dollar Index,” he explained, as the US dollar experienced significant overnight declines.

The Road Ahead

While Trump 2.0 is unlikely to reshape India’s markets overnight, policies targeting China could have indirect benefits. Investors are advised to remain vigilant and keep an eye on geopolitical developments, trade dynamics, and domestic budgetary outcomes to navigate this period of uncertainty effectively.