- The BSE Sensex Index has risen in each of the last three months but a breakdown in US-India trade talks could spoil the party.
BSE Sensex Index climbed for the second successive session on Thursday, hitting weekly highs of 81,911 points. However, there remains an underlying weakness as investors take a cautious approach amid an escalation of risk in the Russia-Ukraine war. That could bring headwinds in the medium-term across the global financial markets. Also, trade tariff risk has recently returned to play, with the United States and India yet to finalise a deal.
The BSE Sensex Index has registered gains for the last three months in succession, partly due to the spoils of the protracted US-China trade tariff war. India had a $46 billion trade surplus over the US in 2024, and will likely have to give concessions when its negotiators meet the US delegation in New Delhi today. The two nations currently trade about $129 billion worth of goods and the broader aim is to raise that to $500 billion by 2030.
It is not clear which kind of concessions India is preparing go take, but protected sectors like the vehicle industry and agriculture could be a prime target for the Trump administration. Also, the US delegation could push for more of Indian defence spending on US armour. The world’s largest and fifth-largest economies are expected to finalise their trade deal by the end of June. However, signs of a barrier could add downward pressure on Indian equities and BSE Sensex index.
BSE Sensex Index Prediction
The BSE Sensex Index pivots at 81,000 points and the momentum signals a likely continuation of the upside above that level. Immediate resistance will likely be at 81,990. However, if the momentum strengthens, the Index will breach that barrier and potentially test 82,485.
Alternatively, the Index could break below 81,000 points and shift the momentum to the downside. If that happens, the first support will likely be at 80,405. Breaking below that level will invalidate the upside narrative and could trigger an extended decline to test 79,830 points.
