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On April 8th, benchmark indices Sensex and Nifty experienced a significant rebound, fueled by positive global cues and widespread buying activity across diverse sectors. The indices extended gains by as much as 2 percent during the afternoon session, showcasing a remarkable recovery from the tariff-induced selloff of the previous day. This bullish sentiment was further supported by the strong performance of midcap and smallcap indices, indicating a broad-based market resurgence. The Sensex climbed a substantial 1,669 points, reaching a day's high of 74,806, while the Nifty surged 505 points, hitting a day's high of 22,666. The market breadth demonstrated a decidedly positive trend, with approximately 2,769 stocks advancing, significantly outnumbering the 596 declining stocks and the 104 remaining unchanged. This strong participation across a wide range of stocks underscored the widespread optimism prevalent in the market during the trading session. The cooling down of India's volatility index, India VIX, also played a crucial role in bolstering market confidence. Often referred to as the 'fear gauge,' the India VIX experienced a notable drop of 9 percent, hovering around the 20 mark. This moderation came after a dramatic spike the previous day, when the index surged by as much as 60 percent to reach a five-year high, reflecting heightened investor anxiety. The decrease in VIX suggested a reduction in fear and panic among investors, further supported by a more stable global backdrop. Asian markets registered gains, the selloff in US equities remained relatively mild, and crude oil prices rebounded following a sharp correction, all contributing to a more favorable investment climate. All sectoral indices traded in the green, demonstrating the breadth of the market's positive performance. The Nifty IT index led the charge, rebounding strongly after enduring a steep 8 percent decline over the past five trading sessions. Major tech stocks such as TCS, Infosys, HCL Tech, and Wipro experienced gains of up to 4 percent in the afternoon session, as the sector prepared to release its financial results for the March-ended quarter in two days. Following the IT sector, notable gains were also observed in the Nifty Realty, Nifty Pharma, and Bank Nifty indices, advancing by up to 2 percent, indicating strength across multiple sectors of the economy. The coordinated movement of these various indices painted a very optimistic snapshot of investor behavior on April 8th. It is important to note that this market recovery was fueled by a complex interplay of both global and domestic factors, emphasizing the interconnectedness of modern financial markets. The previous day's selloff was primarily attributed to concerns surrounding tariffs and global trade tensions, highlighting the sensitivity of investor sentiment to geopolitical developments.
Despite the significant rebound and the positive market sentiment, several market experts advised investors to exercise caution in the short term, primarily due to continued uncertainty stemming from tariff-related tensions. The ongoing trade dispute between the United States and China remained a significant concern, with the potential to disrupt global economic growth and negatively impact corporate earnings. In a recent development, China’s Commerce Ministry issued a sharp response to US President Donald Trump’s renewed threat to raise tariffs on Chinese imports to as much as 50 percent. This escalation came just a day after Beijing imposed retaliatory tariffs of 34 percent on American goods, further exacerbating the trade tensions. Chetan Ahya, Chief Asia Economist at Morgan Stanley, highlighted the potential impact of these trade tensions on India's economic growth. Speaking to CNBC-TV18, he stated that India could face a 40 to 50 basis point downside in GDP growth as a consequence of ongoing tariff tensions. This underscores the vulnerability of even relatively robust economies like India to global trade disruptions. The interconnectedness of the global economy means that even seemingly distant trade disputes can have significant repercussions for businesses and investors worldwide. The potential for reduced trade flows, increased costs, and disrupted supply chains all contribute to heightened uncertainty and can negatively impact investment decisions. The comments from Chetan Ahya emphasized the importance of considering macroeconomic factors and global events when making investment decisions. Investors must carefully assess the potential risks associated with trade tensions and other geopolitical uncertainties, and adjust their portfolios accordingly. He offered a sober counterpoint to the day’s generally positive economic news. The cautionary advice from market experts reflects a recognition that short-term market fluctuations can be influenced by a variety of factors, including investor sentiment, technical analysis, and macroeconomic trends. While the market rebound on April 8th provided some relief after the previous day's selloff, it is essential to remain vigilant and avoid complacency. The potential for further volatility remains, and investors should be prepared to adjust their strategies as market conditions evolve.
Kenneth Andrade of Old Bridge AMC provided a more nuanced perspective on the current market environment. During a conversation with CNBC-TV18, he emphasized that India must reassess its tariff policies while continuing its trajectory of economic progress. This highlights the need for a proactive and strategic approach to trade policy in the face of evolving global dynamics. Andrade noted that the worst phase of market volatility appeared to have passed, with overvaluation and speculative bubbles having largely deflated and normalized. This suggests that the market correction had created a more sustainable and stable foundation for future growth. According to Andrade, this correction in valuations paves the way for long-term investors to operate in a more stable environment, with the potential for consistent annual returns of around 12 percent. This positive outlook suggests that while short-term uncertainties may persist, the long-term prospects for the Indian market remain promising. However, he added a note of caution, pointing out that while financial stocks appear attractively valued, deep value opportunities across the broader market remain limited, and some operational headwinds persist. This implies that investors should exercise selectivity and carefully assess individual investment opportunities, rather than blindly chasing returns across the entire market. The reference to operational headwinds suggests that some companies may still face challenges related to cost pressures, regulatory changes, or other factors that could impact their profitability. This underscores the importance of conducting thorough due diligence and understanding the specific challenges and opportunities facing individual companies before making investment decisions. The combined insights from Chetan Ahya and Kenneth Andrade offer a comprehensive view of the current market environment. While the market rebounded on April 8th, and long-term prospects remain positive, investors should remain cautious and selective, carefully considering both global and domestic factors when making investment decisions. The emphasis on tariff policies highlights the importance of government action in shaping the investment climate. In conclusion, the article underscores the dynamic and complex nature of the stock market. While short-term volatility may be influenced by various factors, long-term success requires a disciplined and informed approach to investment. Investors should carefully consider their risk tolerance, investment objectives, and time horizon before making any investment decisions, and consult with qualified financial advisors as needed. The disclaimer at the end of the article further reinforces the importance of seeking professional advice before making any investment decisions, emphasizing that the views and investment tips expressed by experts are their own and not those of the website or its management.
Source: Sensex at day's high, Nifty above 22,650 amid cooling volatility, broad-based buying across sectors