Indian Stock Indices Resilient Amid Volatility

Indian stock indices, Sensex and Nifty, ended the day with a 0.2% gain, marking a three-day positive streak amid ongoing Trump tariff concerns. Analysts note that market stability hinges on fundamental economic improvements. The Federal Reserve's policy decisions remain a critical focus for investors navigating trade uncertainties.

Indian stock indices extended their gains for a third consecutive day, as both Sensex and Nifty closed with a 0.2% increase despite volatility driven by concerns over tariffs implemented by former President Donald Trump.

Vinod Nair, Head of Research at Geojit Financial Services, commented that the upward trend is partly justified by valuation corrections. However, he cautioned that the longevity of this rally requires a fundamental economic revival.

Tuesday saw a significant rise in Sensex and Nifty, with gains of 1.53% and 1.45% respectively. Shrikant Chouhan of Kotak Securities suggested the market remains in positive territory but warned of potential range-bound behavior due to overbought conditions.

Inflation figures for February offered some respite to domestic equity indices, which have been under pressure from US tariff uncertainty. The long-term impact of Trump's tariff policy, favoring equal tariffs across nations, is causing significant investor caution.

Despite recent gains, Sensex remains over 10,000 points lower than its peak of 85,978 points, having dropped more than 4% since the start of the year. Challenges such as subdued domestic economic growth and corporate earnings continue to mirror in India's stock markets.

As of 2024, Sensex and Nifty saw a 9-10% increase, down from a 16-17% rise in 2023, and only a 3% gain in 2022. Investors face hurdles like weak GDP growth, foreign fund withdrawals, and stagnant consumption in addition to rising food costs.

(With inputs from agencies.)