The government had on June 21, 2018 decided to impose these duties in retaliation to the US decision of significantly hiking customs duties on certain steel and aluminium products.
Indian equities this week will be guided by factors like geopolitical developments, US-China trade negotiations and Fed interest rate decision amid lack of major domestic triggers, say analysts. Investors will also keep a track on the domestic trade situation following reports that India has decided to impose retaliatory tariffs on 29 US products with effect from June 16.
The government had on June 21, 2018 decided to impose these duties in retaliation to the US decision of significantly hiking customs duties on certain steel and aluminium products. India had extended the deadline for imposition of duties multiple times in the hope that some solution would emerge.
“Markets are currently dancing to the global tunes and we do not see this changing any time soon, in absence of any major local trigger,” said Jayant Manglik, President – Retail Distribution, Religare Broking. Vinod Nair, Head of Research, Geojit Financial Services, said: “Ripple effect from a weak global market while premium valuation and slow economy is hurting the market. Continuous exchange of words between US and Tehran regarding the oil tanker attack, progress of US-China trade war, Fed policy outcome on 19th June and progress of monsoon will be closely watched by the investors.”
Global markets were spooked last week after two oil tankers were attacked in the Gulf of Oman, leading to ratcheting up of tensions in the Middle East. Crude oil prices, movement of rupee against the dollar and foreign fund investment trend would be crucial for the markets, experts added.
“Negative news flow from the finance sector on loan repayment is dampening the investors sentiment which can be a trigger for a bigger correction before the budget session,” said Romesh Tiwari, Head of Research, CapitalAim. The BSE Sensex stayed on the back foot for the third straight session Friday as investors dialled down equity exposure amid high valuations and a fresh spell of uncertainty in the global markets.
The markets suffered a sudden sell-off towards the fag-end following reports of India deciding to impose retaliatory tariffs on 29 US products. During the last week, the Sensex fell 163.83 points or 0.41 per cent, to close at 39,452.07.