Market Sentiment Cautious as US Tariff Threats Loom

Market experts are predicting selective purchasing activities, heavily influenced by the latest quarterly earnings reports. The overall sentiment remains tethered to economic indicators and the unfolding India-US trade negotiations.

VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, comments, "The recent technical bounce back in Nifty by 140 points is unlikely to sustain in the current unfavorable market scenario. Such recoveries are typical in oversold markets. The primary concern remains the negative developments on the India-US trade front, particularly President Trump's remarks on potential tariffs."

Global Markets and Commodities Watch

US markets closed lower, with S&P 500 and Nasdaq stepping back from their peaks due to disappointing corporate results, as eyes turn to the Federal Reserve's policy announcement. Meanwhile, Asian stocks showed mixed reactions, with minimal impact from slight progress in US-China trade talks. Gold prices held steady, with traders on edge ahead of the Fed's decision and ongoing US trade discussions.

Investment Flows and Outlook

Foreign portfolio investors continued their selling spree, offloading shares worth Rs 4,637 crore net, while domestic institutional investors emerged as net buyers, purchasing Rs 6,147 crore worth of shares. Despite the headwinds, long-term investors might find opportunities to accumulate high-quality stocks at fair valuations.