{"id":54979,"date":"2025-04-10T11:00:00","date_gmt":"2025-04-10T05:30:00","guid":{"rendered":"https:\/\/www.equentis.com\/blog\/?p=54979"},"modified":"2025-04-10T16:26:56","modified_gmt":"2025-04-10T10:56:56","slug":"markets-rally-on-tariff-pause-is-india-the-next-big-winner","status":"publish","type":"post","link":"https:\/\/www.equentis.com\/blog\/markets-rally-on-tariff-pause-is-india-the-next-big-winner\/","title":{"rendered":"Markets Rally On Tariff Pause\u2014Is India The Next Big Winner?"},"content":{"rendered":"
<\/div>\n

Trump\u2019s Tariff Freeze: A Relief Rally with Uneven Effects<\/strong><\/h2>\n\n\n\n

Donald Trump\u2019s April 9 declaration\u2014a 90-day tariff hike pause for all countries except China\u2014triggered an instant global<\/a> reaction<\/strong>. Investors welcomed the temporary de-escalation of trade tensions, especially given the high-stakes rhetoric around “trade realignment” and “domestic reshoring.”<\/p>\n\n\n\n

The policy announced via the CNN Town Hall and confirmed by White House briefings explicitly spared U.S. allies and strategic partners\u2014but hit China with fresh 12.5% tariffs on $18 billion worth of imports.<\/p>\n\n\n\n

\u201cA lot of countries are kissing my ass to make a deal,\u201d Trump declared. That crass bravado masked a real pivot: a short-term global easing to stabilize economic sentiment.\u201d <\/p>\n\n\n\n

Global Markets React: From New York to Tokyo<\/strong><\/h2>\n\n\n\n
Markets<\/strong><\/td>Index<\/strong><\/td>% Change (2 days)<\/strong><\/td><\/tr>
USA<\/td>Nasdaq<\/a><\/td>2.8<\/td><\/tr>
Europe<\/td>Euro Stoxx 50<\/td>1.6<\/td><\/tr>
Japan<\/td>Nikkei 225<\/td>2.1<\/td><\/tr>
Hong Kong<\/td>Hang Seng Index<\/td>0.4<\/td><\/tr>
China<\/td>Shanghai Composite<\/td>-1.3<\/td><\/tr>
India<\/td>Nifty<\/a> 50<\/td>1.5<\/td><\/tr><\/tbody><\/table>
Source: Bloomberg, April 10, 2025<\/figcaption><\/figure>\n\n\n\n

While U.S. and European markets surged<\/strong>, the Chinese market slipped<\/strong>, underlining investor anxiety over the renewed pressure from Washington. Japan\u2019s Nikkei and India\u2019s Nifty 50<\/a> also posted gains, buoyed by hopes that they could absorb some of China\u2019s export market share. <\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Why the Pause? Economic Pressures Meet Diplomatic Positioning<\/strong><\/h2>\n\n\n\n

The U.S. faces stubborn inflationary pressures despite the Fed\u2019s restrictive rate stance and solid GDP growth of 2.3% in Q1 2025. As of March 2025, the core Personal Consumption Expenditures (PCE) price index rose by 2.8% YoY\u2014above the Fed\u2019s 2% target (source: U.S. Bureau of Economic Analysis<\/a>).<\/p>\n\n\n\n

Higher tariffs risked fanning the inflationary flame just as the Fed considers easing.<\/p>\n\n\n\n

Rising import costs due to tariff risk are exacerbating this issue. A Goldman Sachs research note said the 90-day pause could shave 0.2 percentage points off expected inflation<\/a>, easing some pressure on the Fed\u2019s rate trajectory.<\/p>\n\n\n\n

Additionally, with the 2024 election cycle behind him and a 2025 economic recovery in sight, Trump is walking a tightrope between populist trade protectionism and market stability. <\/p>\n\n\n\n

For Trump, this is economic realism cloaked in bravado:<\/p>\n\n\n\n