Trump’s tariff pause: Why may Indian stock market have a strong gap-up opening on Friday – 11 April 2025? EXPLAINED | Stock Market News
Source: Live Mint
The Indian stock market may see a strong gap-up opening on Friday, April 11, possibly driven by relief over one of the most pressing concerns in recent times — a trade war.
US President Donald Trump has announced a 90-day pause on reciprocal tariffs but raised tariffs on Chinese imports to 125 per cent. Meanwhile, Trump said the 10 per cent baseline tariff on all other imports would remain in place.
The domestic market is closed today (Thursday, April 10) on account of Mahavir Jayanti.
The Trump factor: Indian market may see a gap-up opening on Friday
The domestic market may see a solid gap-up opening on Friday, mirroring trends in major global peers.
Trump’s announcement of a pause on tariffs for countries, except for China, gave a massive boost to global market sentiment.
On Wall Street, Nasdaq soared 12.16 per cent, and the S&P 500 jumped 9.52 per cent. Dow Jones clocked a hefty gain of 7.87 per cent. In Europe, the FTSE, CAC and DAX jumped up to 6 per cent, while in Asia, Nikkei closed with a gain of 8.36 per cent, Taiwan Weighted index jumped 8.46 per cent and Kospi leapt 6.19 per cent.
As Mint reported earlier, Trump on Wednesday announced that he had authorised a 90-day pause, and a lowered Reciprocal Tariff of 10 per cent during the three months of truce amid trade wars induced market meltdown. President Trump also announced that US had hiked China tariffs to a whopping 125 per cent.
Pranay Aggarwal, Director and CEO of Stoxkart, pointed out that President Trump has declared a 90-day pause on most of these tariffs, excluding China, which faced an increased tariff of 125 per cent. This decision is aimed at alleviating global economic tensions and was met with a positive response from international markets.
Asian markets rebounded as investor sentiment improved. The abrupt changes in tariff policies have introduced volatility into the markets.
“While the tariff pause has provided temporary relief, sectors directly impacted by the tariffs, such as pharmaceuticals and seafood exports, continue to face challenges. Investors are advised to monitor ongoing trade negotiations and sector-specific developments closely to navigate this period of uncertainty,” said Aggarwal.
Additional factors that may boost market sentiment
Apart from Trump’s tariff pause, which is an immediate trigger for the market, positive news on the macroeconomy side may also add to the market’s positive momentum.
The Reserve Bank of India on Wednesday announced a 25 bps rate cut and projected moderation in inflation in FY26.
RBI believes inflation will decline further, remaining comfortable this year as the central bank trimmed inflation projection for the current financial year to 4 per cent against 4.2 per cent earlier.
The central bank, however, slightly trimmed the growth outlook.
Highlighting the impact of global trade and policy uncertainties, RBI cut GDP growth projections for FY26 to 6.5 per cent from 6.7 per cent earlier.
Moderating inflation and growth indicate there could be three to four more rate cuts in the current cycle.
Moreover, monsoon is expected to remain normal this year. Private forecaster Skymet Weather said on Tuesday said India is expected to experience a normal monsoon this year from June to September.
Indian stock market benchmark Nifty 50 ended 0.61 per cent lower on Wednesday after the RBI cut the repo rate and changed the policy stance. However, the domestic market still outperformed major global markets.
Experts say even though the Indian economy cannot completely distance itself from global turmoil, it will be relatively less affected by the tariff war.
“For India, merchandise exports to the US accounted for only 2-2.5 per cent of the gross domestic product (GDP) in the three years through fiscal 2024. While a slowdown in global trade and GDP growth of developed economies could impact India’s export-oriented sectors, strong balance sheets may provide much-needed cushion to credit profiles in a volatile global trade environment,” said Crisil.
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Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions, as market conditions can change rapidly, and circumstances may vary.
