The Nifty 50 Index wavered this week, even as the trade war between the United States and India escalated. It was trading at ₹24,780 on Friday, a few points above this week’s low of ₹24,600. This article explores the impact of tariffs and some of the top stocks to watch next week.
India-US trade war to escalate
The Nifty 50 Index wavered this week, even after Donald Trump escalated his trade war with India. The US will now impose a 25% tariff on most goods from China, a move that will impact some top companies like Tata Motors, Reliance Industries, and Sun Pharma.
India has ways to respond as the US exports goods valued at over $41.8 billion, with most of the items being crude oil, machinery, and construction equipment.
Nifty’s performance is a sign that market participants expect the trade war to be short-lived. According to Bloomberg, Indian officials are working behind the scene to reach a deal with the White House.
Officials are considering a deal that would have India increase its purchases of American goods, including oil and natural gas. This aligns with the approach taken by other countries during these trade negotiations. Bloomberg also notes that Indian officials were not considering any retaliations.
Top Indian stocks to watch next week
The Nifty 50 Index is expected to be affected by the earnings announcements of some notable companies scheduled for publication next week.
The most notable one will be the State Bank of India (SBI), the biggest bank in the country, which will release its numbers on August 8. Analysts expect its results to show that its revenue jumped to ₹527 billion, while its earnings per share was ₹16.37.
Indian banks are benefiting from an economy that is doing better than expected and the relatively higher interest rates. The country’s interest rate is 5.50%, higher than in other countries.
The other top Indian companies to watch will be Oil & Natural Gas Corporation, Tata Motors, Bharat Petroleum, Bajaj Auto, and Bharti Airtel.
Tata Motors, the parent company of Jaguar Land Rover and Tata Daewoo, has faced pressure in recent years, with its stock declining by 44% from its peak in 2024. Its stock dropped further this week after it announced its 3.5 billion euro buyout of Iveco Group.
Nifty 50 Index technical analysis
The daily chart shows that the Nifty 50 Index has been in a strong downtrend in the past few weeks. It moved from a high of ₹25,675 in July to ₹24,700 today, its lowest point since June 16.
The Nifty Index has moved below the 50-day and 25-day Exponential Moving Averages (EMA). Moving below these averages is a sign that bears are in control a bit.
The Relative Strength Index (RSI) and the MACD indicators have all continued falling. Therefore, the most likely outlook is that the Nifty 50 Index will continue falling as sellers target the psychological point at ₹24,000. A move above the resistance point at ₹25,000 will invalidate the bearish outlook.
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