The markets are likely to remain volatile, but the downside is expected to be limited, since eventually there is a high probability of a positive India USA trade deal.
Negotiations are still taking place, an American trade delegation is visiting India in August 2025 and President Trump around Sep – Oct 2025 for the Quad summit.
For India it is important to have favourable terms with the USA because of growing USA Pakistan ties, transactional nature of Trump’s policies and the development of an alliance involving Pakistan , China & Bangladesh.
India has the ability to offer concessions on :
- Data localization, e-commerce rules, or agriculture access (even symbolically),
- A significant energy or defense purchase,
- Alignment in the U.S. – led Indo-Pacific strategy.
Such a deal will make the present levels a buying opportunity.
Therefore my view is that in the present circumstances, we should retain our long term equity positions; although for some time , a broad range with a slightly negative bias might persist.
