“The headwinds for the market from Trump tariffs will weigh on markets constraining the rally of the last 6 days. If the penal tariff of 25% kicks in on August, and this appears likely, the impact on India’s growth will be not be 20 to 30 bp estimated with 25% reciprocal tariffs, but more. The market will have to discount that.
A significant trend in the market is the outperformance of largecaps, which is desirable and fundamentally justified. While Nifty is up by 1% during the last one year, Nifty Midcap 150 is down by 0.35% and Nifty Smallcap 250 is down by 4.7 % during the same period. This trend is fundamentally justified and likely to continue. Midcap IT is showing resilience now.
Investors should focus on valuations now.”
