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Home > Stock Market Updates > Opening Bell - 03 / 02 / 25
Podcast: Stock Market Updates
Episode:

Opening Bell - 03 / 02 / 25
Category: Business
Duration: 00:02:03
Publish Date: 2025-02-03 03:31:21
Description:

Opening Bell - Morning Commentary


Tumultuous Week ahead - Trump Tariffs Trigger Trade war


Global markets face significant turbulence following U.S. President Donald Trump's announcement of new tariffs: 25% on Canadian and Mexican imports, and 10% on Chinese goods. U.S. stock futures have fallen sharply in response, potentially setting the stage for a volatile week in global equities. Canada has swiftly retaliated with its own 25% counter-tariff on U.S. goods, affecting trade worth over $100 billion.


The dollar has strengthened considerably against major currencies, with the Canadian dollar dropping to its lowest level since 2003 and the euro continuing its downward trend. This dollar rally reflects market expectations that the tariffs will boost inflation and maintain elevated U.S. interest rates. Additionally, investors believe these measures will impact foreign economies more severely than the U.S., enhancing the dollar's appeal as a safe-haven currency.


The Fed held interest rates steady this week, as expected, as core PCE remains above the 2% target The Federal Reserve maintained steady interest rates this week, an anticipated move given that core PCE remains above the 2% target and the pace of disinflation has moderated.


Asian markets experienced sharp declines in morning trading, while oil prices surged higher.


The budget's emphasis on consumption-oriented measures, coupled with a relatively modest increase in capital expenditure allocation, signals a shift in focus from strengthening fiscal multipliers through capex to prioritizing immediate economic gains. This shift has particularly benefited FMCG and automotive sectors, following significant adjustments to personal income tax structures.

Foreign portfolio investors maintained their exodus from Indian equities, marking their 22nd consecutive session of selling on the budget day.


With budget-related movements now largely priced in, market attention is returning to global factors. Indian markets are expected to open sharply lower in response to concerning global indicators, with technical support levels anticipated between 23,000 and 23,200 for the week.
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