Stock Market Trump / Recession and inflation expected due to Trump tariff, why is the stock market booming?

Stock Market Trump: After US President Donald Trump's announcement of his reciprocal tariff, it was expected that India's stock market would see a decline. This apprehension was also because on Tuesday, US stock markets had registered a decline of more than one percent. Despite this, India's stock market saw strength. By 12.30 pm, the Sensex was trading with a gain of 943.87 points, while the National Stock Exchange (NSE) Nifty also saw a gain of 300 points. This increase benefited investors by more than Rs 7 lakh crore.

Tremendous jump in the stock market

Despite Trump's announcement of imposing tariffs against India, the Indian stock market saw a positive trend. The Bombay Stock Exchange (BSE) Sensex rose 943.87 points to 73,933.80. A day earlier, the Sensex closed at 72,989.93. Nifty also rose 300 points to reach 22,375.05. By 12.10 pm, Nifty was trading at 22,358.25, up 275.60 points.

Key gainers and losers

Growers: Trent (5.80%), PowerGrid (4.37%), Mahindra & Mahindra (4.34%), Adani Port (4.19%), Tata Steel (3.98%).

Growers: Bajaj Finance (-2%), HDFC, Grasim Bank, IndusInd Bank and Bajaj Finserv (down less than 0.50%).

Reasons for rise in stock market

Improvement in foreign markets: Most Asian markets witnessed strength, which also supported the Indian market.

Fall in crude oil prices: The fall in Brent crude prices gave relief to the Indian market.

Foreign investors selling and domestic investors buying: Foreign institutional investors (FIIs) sold shares worth Rs 3,405.82 crore, while domestic investors (DIIs) bought shares worth Rs 4,851.43 crore.

Strength in Rupee: The rupee opened at 87.23 against the dollar, giving stability to the market.

Short covering: Due to the fall in the market for a long time, investors covered short positions, due to which the market saw recovery.

Big benefit to investors

Investors got big profits from this boom in the stock market. The market cap of BSE increased from Rs 3,85,07,568.89 crore to Rs 3,92,77,338.9 crore, giving investors a profit of Rs 7,69,770.01 crore.

Expert opinion

Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said that despite the uncertainty of US tariffs, the Indian market saw strength. He said that the US market may continue to decline due to rising inflation in the US and aggressive policies by the Federal Reserve, which may benefit India to some extent.

Conclusion

Although uncertainty remains globally due to US tariffs, the Indian stock market has performed strongly. Despite the selling by foreign investors, buying by domestic investors and positive global signals strengthened the market. Investors will need to be cautious in the days ahead, as global economic conditions may affect the market.