Shreyash Devalkar Flags Range-Bound Markets on Trade Uncertainty

Shreyash Devalkar, Head of Equity at Axis AMC, said Indian markets are expected to remain sideways as investors await clarity on the US-India trade deal.

Market sentiment has remained wary with negotiations yet to be called and the tariff policies still uncertain as the indices have remained range bound. A break in in the talks or tariff policy clarity can lift sentiment, he said.

The 2026 has started with an overcast of geopolitical conflicts, such as flashpoints in Venezuela, Iran, and Taiwan. This has caused instability in the international markets and it has caused an increase in the price of crude oil, which has impacted on the emerging market currencies such as rupee.

These notwithstanding, the strong domestic demand and the reforms that have been happening in India offer certain buffer to the external shocks, albeit the high-energy prices can press on short term returns.

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Devalkar pointed out those industries that have the highest domestic demand, which include consumer staples industries, utilities and retail banking industries are in better positions to deal with global uncertainty. The export oriented industries such as textiles, gems, leather, metals and chemicals continue to be exposed to geopolitical risks and uncertainty in trade. The continued outflow of foreign money in the form of foreign portfolio and the halted India-US trade negotiations have strained the equity markets and also led to restrained investor behavior.

In the prospective, the business will be dependent on the returns growth, the fiscal changes, and the Budget 2026 provisions that will lead growth to be capex-led. Although volatility could persist in the short term, long-term investors with a long-term perspective and with the use of quality business ventures would gain out of the market stability again.