What to Expect from the Stock Market Amid US-China Trade Tensions?

Market Outlook for the Week Ahead

New Delhi: Analysts predict that stock markets will be influenced by ongoing developments in the US-China tariff conflict, alongside quarterly earnings reports from major IT firms like Wipro and Infosys during this holiday-shortened week.

Market movements will also be shaped by global trends and the trading activities of foreign investors, experts have indicated.

Equity markets will observe closures on Monday for Dr. Baba Saheb Ambedkar Jayanti and on Friday for Good Friday.

Puneet Singhania, Director at Master Trust Group, noted, “The forthcoming week is likely to be turbulent for both global and Indian markets, as the trade tensions between the US and China escalate, with both nations imposing tariffs on each other, leading to market instability. Domestically, we anticipate the release of WPI and Consumer Price Index inflation data, while significant macroeconomic data from the US, UK, and China is also expected.”

In early April, US President Donald Trump introduced a substantial tariff plan. Subsequently, the White House announced a 90-day suspension of 'reciprocal tariffs' for most countries, excluding China, which retaliated by imposing a 125% tariff on US imports.

China has increased its additional tariffs on US goods to 125%, responding to America's 145% levy.

Despite the ongoing tariff conflict, China has expressed willingness to engage in discussions with the US.

Ajit Mishra, SVP of Research at Religare Broking Ltd, stated, “This holiday-shortened week will be sensitive to further developments regarding US-China tariffs. Domestically, corporate earnings will be in focus, with major players like Wipro and Infosys from the IT sector, along with banking giants HDFC Bank and ICICI Bank, set to announce their quarterly results.”

Last week, equity benchmarks concluded on a low note, experiencing modest losses amid increased volatility.

The BSE benchmark Sensex fell by 207.43 points, or 0.27%, while the NSE Nifty decreased by 75.9 points, or 0.33%.

On April 2, the US announced an additional 26% tariff on Indian goods entering the country. However, on April 9, the Trump administration suspended these tariffs on India for 90 days, until July 9, while maintaining the 10% baseline tariff.

Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd, commented, “We anticipate that Indian markets will remain volatile, influenced by global market cues, developments regarding US tariffs, and Q4 corporate earnings announcements.”

Market sentiment will also be affected by the rupee-dollar exchange rate and fluctuations in global oil prices, particularly Brent crude.

According to a note from Bajaj Broking Research, “This week will feature a range of important economic data releases from major global economies, which are expected to shape market sentiment and influence monetary policy expectations.”