6 days Ago
After a period of volatility driven by global turmoil, the Indian benchmark indices made a strong recovery, reversing earlier losses caused by US-imposed tariffs earlier this month. The Nifty 50 crossed the 23,300 mark while the Sensex surged over 1,600 points in a single session, supported by global optimism, easing market volatility, a temporary reprieve from steep US tariffs and significant short-covering. The Nifty and Sensex surpassed their April 2 closing of 23,332.
35 points and 76,617.44 points, respectively, during the day. The rally followed a market holiday on Monday, with investors returning in a bullish mood as banking, auto, and IT stocks led the gains.
Investor sentiment received a lift after US President Donald Trump announced a temporary exemption on certain consumer electronics from a proposed 125 per cent tariff on Chinese imports. The move — which covers products such as smartphones, laptops, and personal computers — was seen as a short-term positive for global trade. Trump also hinted at potential relief for the automobile sector, which is currently grappling with high import duties.
While the near-term sentiment remained upbeat, the evolving trade narrative continued to inject an element of unpredictability into global markets. According to Vinit Bolinjkar, Head of Research at Ventura Securities, the sharp rebound reflects growing investor confidence even as global markets remain under pressure. “Dalal Street witnessed a strong rebound today, with the Nifty 50 crossing 23,300 and the Sensex rallying over 1,600 points, driven by global optimism, sharp short-covering, and easing volatility — as reflected in the 17 percent drop in India VIX,” Bolinjkar said.
Where should you invest now? As markets rebound from a volatile patch, experts from Ventura Securities and Canara Robeco Mutual Fund have weighed in on where investors should deploy capital next. With global uncertainties brewing and domestic fundamentals holding steady, the consensus is that Indian equities may be entering a constructive phase — but selectivity is key. Bolinjkar noted that the bounce comes against a chaotic global backdrop.
“We’re witnessing an unusual scenario where both US bonds and equities are tumbling simultaneously,” he said. This trend, he explained, was triggered by President Donald Trump’s implementation of sector-specific tariffs, which spurred China and other nations to offload US Treasuries, leading to a sharp correction in bond prices and equity markets. The ensuing inflation fears have forced the US Federal Reserve into a more hawkish stance — contrary to Trump’s demand for rate cuts.
Yet, with the US dollar weakening below 100 on the DXY and outflows from American assets accelerating, Indian equities are starting to look attractive again, especially to foreign institutional investors (FIIs). Bolinjkar pointed out that expectations of backchannel trade negotiations following Trump’s 90-day tariff pause could provide more clarity in the coming weeks. “The pause appears to be more of a tactical move by the US rather than real relief for global trade partners,” he said, adding that sectors like pharmaceuticals may remain under pressure, depending on how tariff discussions evolve.
Meanwhile, the Reserve Bank of India’s steady inflation forecast and balanced policy stance have reassured domestic investors. “This kind of clarity from the central bank adds to market confidence, especially when global cues are unsettling,” Bolinjkar added. Long-term case for India intacts, say analysts Meanwhile, Shridatta Bhandwaldar, Head of Equities at Canara Robeco Mutual Fund, echoed similar sentiments but from a longer-term perspective.
He acknowledged that the tariff-induced uncertainties could hurt near-term global growth, but remained confident that capital would continue flowing into emerging markets like India as investors seek better risk-adjusted returns outside the US. “India’s macroeconomic foundations remain strong,” Bhandwaldar said. “Government and private balance sheets are in better shape compared to the previous down cycles, and we expect earnings to bounce back to low double-digit growth over the next few quarters.
” He also pointed to the RBI’s recent 25 basis point repo rate cut as a significant development. With borrowing costs set to decrease, consumer spending and corporate investments are likely to pick up pace. This, in turn, should support domestic demand, improve export competitiveness, and aid GDP growth .
“The central bank’s move is well timed,” he said, “and we believe it will support the nascent recovery in the broader economy.” On valuations, Bhandwaldar said large-cap stocks are now trading around their historical averages, making them appealing to long-term investors. While valuations in the broader market — especially among mid- and small-cap stocks — appear slightly stretched, he believes earnings recovery will unlock further upside in these segments.
“The key will be earnings delivery, particularly in sectors with high operating leverage.” In terms of Canara Robeco’s sectoral preferences, Bhandwaldar said they remain overweight on large private banks, telecom, pharmaceuticals, and aviation. “These sectors are better placed to ride out global uncertainty and benefit from improving domestic trends,” he noted.
The fund house remains cautious on commodities and energy, where global volatility and pricing pressures could pose risks. Looking ahead to FY26, Bhandwaldar expects a gradual improvement in both corporate earnings and market sentiment. “It’s not going to be a linear recovery,” he cautioned, “but the trajectory is headed in the right direction.
That sets a positive tone for medium-term investors.” Stay invested, but stay selective Both Ventura Securities and Canara Robeco Mutual Fund believe that Indian equities are well-positioned to benefit from the shifting global capital flows and a stable domestic macro environment. While volatility may persist in the short term — especially due to geopolitical and tariff-related developments — the long-term growth story remains intact.
For investors, the current rally offers opportunities, but not without risks. Sectoral preferences and stock selection will be crucial, with large banks, pharma, and telecom emerging as early favourites. As always, a balanced and disciplined approach to portfolio construction will be key to navigating the uncertainties ahead.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions..
