Ramesh Damani on Trump win and what to expect from the markets now

BSE member Ramesh Damani believes Trump’s return to the White House, along with control of the Senate and Congress, could lead to significant shifts in global trade, immigration, and economic relations, especially between the US and India.

Damani expects an initial “honeymoon phase” for markets, with both the Dow and Sensex likely to rally as Trump’s pro-business stance fuels investor optimism.

However, he cautioned that this initial rally could be short-lived, as Trump’s unique position of “unchecked power” could lead to sweeping, unpredictable changes.

Also Read: How will a Trump win affect India?

“The thing you have remember is that now Trump is not going to be a lame duck President. He doesn’t have to go back for an election ever again. But he’s also an unchecked power right now because after this extraordinary comeback everyone will bow to his wishes, including a Republican Congress,” Damani noted.

Emerging market fund managers, he believes, may need to adjust portfolios in response to Trump’s return, favouring markets aligned with US interests.

As for Indian market valuations, Damani sees the recent 7-8% drop as a healthy correction rather than a downturn.

He expects the market to consolidate over the next few months before regaining momentum toward previous highs.

He believes Indian exports could face increased tariffs, given Trump’s previous critiques of India’s trade practices.

Also Read: Complete list of states won by Trump and Harris

“First, all of Indian goods will probably face a tariff barrier,” Damani said, explaining that Trump’s “America First” stance could lead to tougher trade terms for India.

On immigration, Damani noted that Trump’s past policies on H-1B visas created challenges for India’s IT sector, and he expects similar restrictions may return.

Still, he believes India’s role as a key partner for US tech needs may continue to support the sector. “I do not expect to see a major downfall in the technology spend space from America because it is quite critical for America …If they want to remain ahead of the world in software, they almost have to come to India,” he remarked, indicating that despite potential visa issues, the US will still rely on India’s tech expertise.

Damani also sees a possible upside for India in Trump’s anti-China stance, as US companies may turn to India as an alternative manufacturing and supply chain hub under the “China+1” strategy.

Also Read: CEA on Trump’s re-election and India economic growth outlook

“This will encourage US manufacturers to seek sourcing, supply chain, and manufacturing bases in India. So, in that limited sense, it will help India,” he said.

Defence companies, too, could see opportunities, as the US seeks to strengthen alliances beyond China.

He cautioned about potential inflation arising from Trump’s proposed tariffs, stressing that it is important to evaluate the new administration’s policies realistically.