The Indian stock market represented by Sensex and Nifty witnessed a significant decline after the inauguration speech of former US President Donald Trump who has become the current President on January 21, 2025. The sharp fall in Indian equities can be attributed to a combination of global and domestic factors which increased the anxiety of investors.
First, Trump’s speech seemed to indicate a more hawkish stance on international trade policies, especially with regard to China and India. This created uncertainty among global investors, which led to a decline in emerging markets such as India. Investors remain concerned about the possibility of trade tensions or sanctions, which could impact global economic growth and, consequently, corporate earnings.
Second, Indian markets were already in a slump due to concerns over domestic economic growth, inflation and corporate earnings. Rising interest rates and inflationary pressures are dampening investor sentiment. Moreover, volatility in global oil prices has further fuelled concerns over inflation and fiscal policy in India.
NIFTY: 23,238.80
SENSEX: 76,601.61
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Newsroom 47