markets rebound | Investors' wealth surges `3.54 lakh crore

FPJ News Service New Delhi

Despite mixed global macro indicators surrounding the US tariffs, Indian markets on Wednesday recovered from Tuesday’s losses. The 30-share BSE Sensex recovered 593 points to settle at 76,617. The NSE Nifty gained 167 points at 23,332. Investors focused on ‘value buying’ in banking, auto, and IT stocks.

S&P Global analysis shows that India’s manufacturing activities recorded impressive growth in March with the fiscal year 2024-25 closing on a healthy note. The PMI surged to an 8-month high of 58.1 in March. This factor strengthened the market sentiment. “This optimism, in general, was largely driven by expectations that the tariffs would have a minimal impact on the domestic economy, given the positive progress in India-US trade negotiations. 

“The manufacturing sector growth hints at a recovery in Q4FY25 corporate earnings,” said Vinod Nair, Head of Research, Geojit Investments. Investors' wealth seen higher at Rs 3.54 lakh crore on Wednesday, FIIs offloaded equities worth Rs 1,538.88, and domestic institutions bought 2,808 crore. On Tuesday, FIIs had offloaded equities worth Rs 5,900 crore, and domestic institutions had bought equities worth Rs 4,323 crore.

“The element of uncertainty regarding reciprocal tariffs was expected to come down late Wednesday. But considering Trump’s flip flops on tariffs earlier, the uncertainty is likely to continue. It appears that FIIs turning buyers in the last several trading days of March was triggered by end of year considerations. 

“The short-covering which FII buying triggered contributed to India’s outperformance in March. Investors can wait for clarity to emerge regarding tariffs and market trends. If the tariffs are worse-than-expected there can be another round of sell-off in the market. Even in such a scenario domestic consumption driven sectors will remain resilient,” said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

According to Jateen Trivedi, VP Research Analyst-Commodity and Currency, LKP Securities, rupee remained flat near 85.47 as markets awaited US reciprocal tariff measures and their potential impact on the global economy. 

“The focus now shifts to Trump’s Labor Day speech, where he is expected to address tariff policies as a solution to the US economic challenges. With uncertainty surrounding the speech, volatility could pick up later in the session. The rupee range is expected between 85.00-85.90, with tariff updates and global sentiment driving further moves.