GLOBAL MARKETS CLOSELY WATCH THE TRUMP 2.0 POLICIES

Donald Trump achieved an unprecedented feat by becoming the first US President in 132 years to be re-elected after a hiatus. In the 47th presidential election, Donald Trump prevailed against Democratic candidate Kamala Harris by a margin of 295 to 226 seats.

Markets celebrated the electoral outcome. The Dow Jones rose 427 points while the BSE Sensex jumped 901 points, propelled by technology stocks riding hopes that his pro-business stance will spur spending and growth in the world’s largest economy.

 The Indian government is confident of positive ties given their previous relationship with the Trump administration. Trump is like to deepen the geo-political engagement with India and the QUAD grouping of India, the US, Australia, and Japan, while intensifying contestations with China. As a result, India may attract more global supply chains.

The US Federal Reserve announced its seventh policy decision for 2024 after a two-day Federal Open Market Committee (FOMC) meeting and voted unanimously to slash the benchmark interest rate by 25 basis points (bps) or (1/4) quarter of a percentage point to 4.50 - 4.75 per cent, broadly in line with Wall Street estimates. US Fed chair Jerome Powell-led rate-setting panel's monetary decision comes just after Republican Donald Trump secured a landslide victory in the US Presidential elections 2024.

On Wednesday, The global markets rose after the news of Trump historical win against Democratic candidate Kamala Harris. Our Indian indices both nifty and bank nifty touched the important levels 24536 and 52458 respectively. But the momentum fizzled out in Thursday and Friday sessions. The FIIS relentless selling is not giving any scope for the market to move higher.

 The Trump factor is likely to create further selling in Asian markets, as his policies largely favors the dollar. A stronger dollar attracts more investments into US equities over commodities. Uncertainty about US Visa issues, and Trumps Make in America' could impact Indian pharmaceutical companies, and there are expectations of stricter USFDA regulations which may further hurt Indian pharma companies. Higher tariffs on China could be unfavorable for Indian metal companies as we rely heavily on China for steel.

Japan's central bank minutes hinting at a potential rate hike, which could further intensify Yen carry trade. This news also affected the Indian stock market. Banks are showing a slowdown in credit growth and margin contractions, while consumer demand remains weak across sectors like FMCG, automotive, retail, and cement. 

Key levels for Next Week:

 Nifty Support: 24017,23946,23853

Nifty Resistance: 24257,24342,24503

Bank Nifty Support: 51443,51249,50902

Bank Nifty Resistance: 51833,52085,52358

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Dr MD KHWAJA MOINODDIN

  MBA,MCom,MHRM,NET,SET,PhD

Stock Market Analyst

Mail: khwaja.moin1@gmail.com

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