The benchmark indices ended higher by over a per cent on Wednesday amid a relief rally following the US presidential election results.
Despite global trade volatility, Donald Trump’s win could lead to strong risk-on sentiment, driven by expectations of tax cuts and increased government spending, as well as a reversal in FPI flows, said experts.
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The Sensex ended higher by 901 points or 1.13 per cent at 80,378, while the Nifty settled at 24,484, up 1.12 per cent. Nifty Midcap 100 Index and Nifty Smallcap 100 rose over 2 per cent.
Sector gains
IT stocks gained in anticipation of a rebound in IT spending in the US. FPIs continued their selling streak, however, offloading shares worth ₹4,445 crore.
“Recent FPI outflows appear to be pivoted on the Chinese economic stimulus in late September. A Trump presidency with prospects of high tariffs on Chinese goods has the potential to reverse the earlier India to China investment shift by FPIs,” said UR Bhat, Director, Alphaniti Fintech.
Trideep Bhattacharya, President & CIO-Equities, Edelweiss MF said that India may be a relative beneficiary among emerging markets as US companies pursue a ‘China +1’ strategy, likely boosting sectors like electronics manufacturing services, chemicals, and pharmaceuticals.
Arindam Mandal, Head of Global Equities at Marcellus Investment Managers, said select Indian exporters could benefit amid a stronger US dollar.
Asian markets in Japan, Taiwan and Singapore also ended higher on Wednesday, with Nikkei 225 surging over 2.5 per cent. European indices were trading firmly in the green. Dow Jones Futures was up over 3 per cent.