Market's Crystal Ball Signals Volatile Days Ahead

67% of the experts feel that gold might outperform Indian equities and debt for the rest of 2025

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Market generally does not "discount the same news twice." "Markets were relatively calmer during the second wave of Covid, even though it was more fatal than the first wave," he argued. Still, Radhika Rao, executive director and senior economist at DBS Bank thinks that a tariff re-imposition might impact the domestic electronics, textiles, pharmaceuticals, and gems and jewelry sectors first. One should also avoid expensive midcap IT stocks, non-ferrous metals and commodity chemicals, given the concerns of dumping from China, according to JM Financial Services.

More importantly, Rao believes a diversification strategy from the US dollar and assets into select emerging markets like India may offer better insulation from global volatility, driving inflows into the domestic market.

To be sure, Indian markets have been reeling under relentless foreign portfolio (FPI) outflows, exorbitant valuations and poor corporate earnings since the second half of 2024, even before Trump's tariffs rattled world markets.

The majority of the respondents (57%) think India's unmatched scale and policy stability relative to smaller emerging market peers will offer respite to investors globally. Even though a few believe that Indian equities' high valuations may limit FPI inflows against cheaper rivals like Brazil or Vietnam, 20% of respondents think overseas flows may remain selective, focusing on select sectors like banking, fast-moving consumer goods and telecom.