Where to invest as markets overcome tariff fears? Analysts weigh in

From Ridham Desai of Morgan Stanley, Wei Li, Global Chief Investment Strategist, BlackRock Inv. Institute and Shridatta Bhandwaldar of Canara Robeco MF, here is the market strategy of leading analysts

Indian stock markets continue to trade firm on Wednesday with the Sensex and the Nifty 50 recovering fully from the April 2 tariff imposition by US President Donald Trump. The surge comes on the back of 90-day pause by the US administration on the imposition of these tariffs.

 

Are the markets completely out of the woods? Is it a good strategy to diversify into international markets? If so, which ones?

 

Is this a 'sell on a rise market', or should investors buy the dips? Which sectors and stocks are a must for your portfolio, and which ones should be avoided? 

The market is transitioning from one driven by macro conditions to one where stock-picking is likely to add alpha. We are capitalisation-agnostic following recent developments, cutting back on our preference for small and mid-caps over large caps.

 

While the bias remains to buy domestic sectors with a cyclical bias, both overweight and underweight positions stand reduced. The Reserve Bank of India (RBI) has policy space to act to support domestic growth, whereas external-facing sectors could go through multiple months of uncertainty.