Opening Bell - Daily Morning Commentary

Dollar Weakens as Trump Delays Tariffs

Donald Trump took oath as the 47th President of the United States. US markets were closed for Martin Luther King Jr public holiday. The dollar tumbled on Monday after incoming U.S. administration did not impose new trade tariffs on the first day in office, alleviating some fears of an immediate blitz. The euro moved strongly higher against the U.S. dollar - its best day of the year so far.

Futures tied to the American markets were volatile on Tuesday, reversing a brief relief rally from early in the session in the first few hours of Donald Trump's new presidency after he announced plans for trade tariffs on neighbouring countries starting next month. Trump is expected to push for trade protectionism and economic nationalism, but the key question is how aggressively he will pursue this agenda.

MSCI All-country world index a proxy for global markets broke immediate resistance and is gathering bullish momentum. Indian markets rallied strongly yesterday, driven by robust performance in banking and metal stocks.

The focus of the Indian market will now shift to the upcoming Union Budget. It is expected to give attention to balancing growth through consumption stimulus and infrastructure spending, with emphasis on agriculture, MSMEs, and job creation.

If the Nifty sustains above 23,391, it could establish a higher top, following the higher low at 23,100. This pattern potentially signals a shift from bearish to bullish momentum. The 23,600-23,700 range appears to be the next significant resistance level. 23,100 is emerging as key support for the nifty.