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Home > Stock Market Updates > Opening Bell - 10 / 02 / 25
Podcast: Stock Market Updates
Episode:

Opening Bell - 10 / 02 / 25
Category: Business
Duration: 00:02:03
Publish Date: 2025-02-10 03:26:07
Description:

Opening Bell - Daily Morning Commentary


Trump Escalates Trade War

The U.S. stock market slumped last week, with the S&P 500 giving up its weekly gain after investors fretted over reciprocal tariffs planned by President Donald Trump. The uncertainty around trade and tariffs continues to remain perhaps the biggest overhang on markets. While U.S. tariffs against Canada and Mexico are on pause, and remain at 10% for China, if there were a meaningful escalation, this could spark some inflationary pressure and lower growth.


Asian shares dithered and the dollar edged higher on Monday after U.S. President Donald Trump warned more tariffs were imminent including on steel and aluminium, an inflationary move that could limit the scope for rate cuts.


Despite uncertainties surrounding tariff policies, corporate earnings remain a bright spot for US markets, with projections showing double-digit growth. The outlook is particularly encouraging given that approximately 60% of S&P 500 companies have already reported earnings, with an impressive 77% surpassing analysts' expectations.


In a watershed moment for India's monetary landscape, under the leadership of the new governor Mr. Malhotra, Reserve Bank of India (RBI) announced a significant shift in its policy framework last Friday, effecting a reduction in the policy repo rate by 25 basis points to 6.25 per cent - marking its first such intervention in half a decade. This calculated move is expected to catalyse credit growth across sectors, particularly benefiting SMES whilst providing much-needed impetus to the real estate sector through reduced borrowing costs.


After a 250-point pullback from the intra-week high of 23807, the Nifty has found support at the 11 and 20-day EMAs (23465 and 23440, respectively) on Friday. A sustained move above 23700 could pave the way for a retest of the 23807, followed by the 24000-24100 zone. Conversely, the 23400-23465 range is expected to provide support on the downside.


The recent interest rate reduction by the RBI's Monetary Policy Committee, combined with favourable income tax measures announced in the Union Budget and the ruling dispensations electoral victories in state election, has created a positive sentiment boost for the market. While global uncertainties continue to impact Foreign Institutional Investor (FII) flows, government initiatives provide a crucial buffer against major market declines, helping maintain investor confidence.
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