Volatility took a breather on May 29, as India VIX dropped over 6% to 16.93. This came during the monthly expiry session, providing some relief for traders who’ve been on edge. The trigger? A US federal court decision that blocked former President Donald Trump’s wide-ranging tariff plans.
For Indian markets, that ruling meant one thing—less fear.
What Does This Mean for Investors?
The court’s decision signals a possible pause in global trade tensions, at least for now. As a result, traders felt safer, and that showed. The Sensex rose by 169 points to 81,481, while the Nifty climbed 38 points to 24,790. Market breadth supported the uptrend—1,653 stocks advanced, while 1,308 declined.
That’s not just numbers—it means retail and institutional players alike were willing to take more risk, at least for the day.
The India VIX, often called the “fear gauge,” measures expected volatility. When it falls, investors expect fewer shocks. While dropping to 16.93 is good news, it’s still above the comfort zone of 15. According to Dhupesh Dhameja of SAMCO Securities, this suggests the market isn’t fully calm yet.
His warning? “Until Nifty breaks above 25,100 or below 24,700 with force, expect more choppy moves—bull traps and stop-hunting included.” In plain words: Watch your back.
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Tariff Trouble: Delayed, Not Deleted
The real jolt came from across the ocean. A US trade court blocked most of Trump’s tariff agenda—at least temporarily. Bloomberg reports that while the Biden administration has appealed, the case could go to the Supreme Court. That could affect trillions in global trade.
VK Vijayakumar of Geojit Financial said it plainly: “This is a message to Trump—you can’t mess with markets unchecked.” He called it the second blow to Trump, after bond markets earlier forced a tariff pause.
Bulls in the Midcap Jungle
Interestingly, while large indices remained range-bound, action shifted to mid- and small-cap stocks. But Vijayakumar warned against chasing anything blindly. “Stick with quality,” he advised. The bull run is not for the reckless.
So, what do we have? A calmer India VIX, a bounce in key indices, and a legal handbrake on trade chaos. But don’t mistake calm for peace. Markets are waiting. Watching. And if 2024 taught us anything, it’s that Trump headlines still move money.
Disclaimer:
This article is for general information only and not financial advice. Markets involve risk. Please consult a financial advisor before investing. Views shared are those of the quoted experts, not this platform.
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