Nifty, Sensex flat as markets weigh Trump’s tariff threat

Indian markets opened on a positive note today with both Nifty and Sensex trading in green as Trump tariff threat is seen as a negotiating tool.

Nifty 50 opened at 23,801.75, up 62.50 points (0.26 per cent) while Sensex started at 78,704.60, up 120.79 points (0.15 per cent). Positive cues from select sectors and investor optimism helped the market to open on a strong note.

Experts are concerned about the global economic uncertainty, particularly on US trade policies. 

Analysts said businesses and governments are studying the impact of Donald Trump first term to assess the risk of a trade war.

Ajay Bagga Banking and Market Expert said "US tariffs on China came into effect on Tuesday. China has had a muted response. China is being restrained because it "has more to lose" as it has huge trade deficit with the US".

He added "We are seeing two giants sizing each other up and testing each other’s resolve and also playing to their domestic audience and then both will go and claim to have got an eventual deal as a "victory".

However many believe a full fledged tariff war is unlikely as Trump didn’t fully implement his earlier threats of additional duties on trading partners.

Experts describe the current situation as an extreme case of Game Theory where investors and policymakers are making decisions based on assumptions about each other’s limits and non-negotiables. Such uncertainty leads to more volatility in the market.

Despite global worries, Indian sectoral indices opened on a strong note with all major sectors up.

Nifty Oil & Gas led the charge with 0.74 per cent gain, Nifty Bank and Nifty IT followed with 0.5 per cent gain each. 35 out of 50 Stocks in Nifty were trading higher while 10 were down at the time of reporting."Technically the index is at the falling trendline drawn from the record high and passing through the mid-December peak. Yesterday’s low didn’t overlap with Monday’s high hence created a bullish rising window, 23381 will be a key level to be watched and bulls will have to defend it. Below this level expect a test of 23918 - 24060 within a week. Close below 23381 will weaken the near term bullish view" said Akshay Chinchalkar, Head of Research, Axis Securities.

Investors are also looking forward to quarterly earnings of several companies today. Some of the key companies announcing their Q3 results today include Info Edge India, Swiggy, Zydus Lifesciences, Solar Industries India, Cummins India, Abbott India, Page Industries, GE Vernova T&D India and Gujarat Gas.

Meanwhile, the broader Asian markets were mixed. Nikkei 225 and Hong Kong’s Hang Seng were down on selling pressure. Taiwan & South Korea’s Kospi was up at the time of reporting.