Buckle up for volatility; Street sees no quick rebound ahead

Souring US-India trade ties have turned up the scrutiny on Indian stocks already witnessing high valuations, weak earnings, and periodic selling by foreign investors.

- Abhinaba Saha & Mayur Bhalerao

Investors are now scrambling for some crucial answers: Will there be some respite from volatility anytime soon? What is the market's expectation from a trade deal with the US? Will earnings downgrades continue? And finally, is there any glimmer of hope of a broader turnaround?

To gauge the market's pulse, we surveyed 34 investment professionals—analysts, economists, research heads, and fund managers—between 25 and 30 July. Their verdict: Brace for more uncertainty, as a US-India trade deal might end up rattling the markets. This is the fourth in a new Mint series of quarterly market surveys, the first of which was held ahead of Diwali in October 2024, the second in February after the Union Budget and the last one in April. Most experts (77%) agreed that while geopolitical risks have certainly reduced over the June quarter, key developments like the US-India trade deal might still negatively surprise markets. Around 9%, including Prashanth Tapse, senior vice-president at Mehta Equities strongly believe that the market is heading into increasingly choppy waters.