Prospects of Trump-Putin Talks and PM Modi’s China Visit Lift Market Sentiment
Mumbai/New Delhi, August 8, 2025: After plunging over 700 points due to concerns over US President Donald Trump’s latest trade actions, the Sensex bounced back into positive territory on Thursday. Optimism grew around possible diplomatic moves, including a Trump-Putin meeting and Prime Minister Narendra Modi’s expected visit to China. These developments injected fresh hope into a market rattled by trade tensions.
The session opened tense as investors reacted to higher US tariffs on Indian exports, sparking fears of prolonged trade strain.However, late buying interest helped the 30-share index reverse most of its earlier losses. By the closing bell, the Sensex stood 79 points higher at 80,623, marking a modest 0.1% gain. The Nifty too mirrored the recovery, ending up 24 points at 24,596. This comeback underscored the market’s resilience in the face of global uncertainty.
Market analysts attributed the turnaround partly to geopolitical developments that could ease global trade pressures. Reports indicated that Trump and Putin might meet later this year. Modi’s planned China trip in August is seen as a potential bridge in strained India-China trade ties. If both occur, they could strengthen diplomacy and open trade opportunities, boosting investor sentiment.
Nevertheless, the day’s trading revealed the sectors most affected by the tariff escalation. The “Bearing the Tariff Brunt” index showed steep declines in textile, pharma, and engineering stocks. Arvind Ltd dropped 7.5%, Raymond was down 9%, Aurobindo Pharma slid 7.5%, and Divi’s Labs lost 7%. Engineering majors like ABB India and BHEL also recorded significant declines, with ABB falling 5.7%. The auto sector presented a mixed picture—Bharat Forge slipped 4%, Bosch fell 2%, while some others managed to hold ground.
The gems and jewellery sector was also hit, with Kalyan Jewellers and PN Gadgil Jewellers losing 6% and 2.5%, respectively. Analysts noted that these sectors remain vulnerable due to their export dependence on markets impacted by US tariffs. However, they also pointed out that any easing of trade tensions could trigger swift recoveries in these counters.
In contrast to the equity market’s cautious recovery, gold prices surged to record highs. Spurred by the tariff war, weak US macroeconomic indicators, and a depreciating rupee, gold on MCX hit ₹1,02,155 per 10 grams, while spot markets in Delhi and Hyderabad quoted above ₹1,02,700. International prices touched $3,509/oz, underscoring gold’s status as a safe-haven asset during times of volatility.
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