US President Donald Trump on April 9 announced a 90-day 'pause' on reciprocal tariffs for all countries except China. This is set to act as a major relief to the markets, which earlier crashed after the tariff announcement on April 2.
After Trump made his 'Liberation Day' announcement and unveiled 26 percent tariff on India on April 2, Indian stock markets strongly reacted, accompanying global peers. Sensex crashed over 2,000 points on April 7, while Nifty plunged over 4 percent.
However, the latest pause on tariffs is expected to provide much needed relief to investors when markets reopen tomorrow (April 11). Notably, markets are closed on April 10 on the occasion of Mahavir Jayanti.
| Sector | Expected outcome | Stocks to watch |
| IT | IT stocks have seen a significant slump in recent days, with Nifty IT falling over 10 percent since April 2. Most of the IT players derive major portions of their revenue from the US. Trump's tariffs triggered fears of US recession, which acted as a major negative for the stocks. However, after the pause on the tariffs, Goldman Sachs dropped their US recession forecast. This is expected to be positive for IT stocks. |
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| Auto component makers | Shares of auto component makers tumbled after Trump's reciprocal tariff announcement. However, these stocks may rise tomorrow, on the back of the tariff pause. |
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| Metals | The tariff pause will be positive for metal stocks which have been the worst hit by the tariffs. Copper and other metal prices have already shot up after the temporary relief. China's stimulus plan, alongside lower risk of a US recession, may help metal stocks. |
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| Realty | Positive sentiment from the tariff pause and 25 bps cut in RBI's interest rates are likely to influence the realty stocks. |
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| Fishery | The shares of shrimp feed companies tumbled after US President Donald Trump announced reciprocal tariffs on several nations including India. Notably, these firms have strong export exposure to US, with significant portion of their revenue being driven by the American market. The tariff pause is expected to boost the shrimp stocks. |
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| Solar EPC firms | India's solar engineering, procurement and construction (EPC) firms have significant exposure to the US market. The latest tariff pause is set to benefit these companies. |
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| Electronic parts makers | Stocks of electronics manufacturing services (EMS) firms in India may see a sharp uptick as global brands like Apple may continue to source parts from India. Notably, the shares are already on the rise since reports emerged stating that Apple is planning to source more iPhones from India to the US to beat the tariffs imposed on China. |
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| Textile | China is the biggest supplier of textiles and apparel to the US. Indian textile players may benefit from the 125 percent tariff imposed on Chinese imports. However, Vietnam and Bangladesh too are large exporters of textile to US. While the hiked tariff on China will likely benefit the textile stocks, the pause on higher tariffs on imports from Vietnam and Bangladesh may negatively impact the stocks. |
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He further said, "The temporary relief gives businesses and India vital space to stabilize supply chains and adapt operations, while also providing policymakers an opportunity to work toward more sustainable trade agreements. While this pause opens the door to reassess global trade dynamics, underlying tensions and uncertainty persist due to the existing 10% baseline tariff on most US imports and what comes after 90 days."
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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