New Delhi: Donald Trump’s remarkable and historic return as US president on Wednesday not only pushed the market sentiments up but also instilled hope in the Indian media and entertainment sector owing to the pro-business stance of the president-elect.
Indian stock markets rallied more than 1 per cent with benchmark Sensex soaring 901 points on heavy buying in IT and pharma shares amid Trump's victory.
Global markets experienced a relief rally following the US election results, reducing political uncertainty with Trump securing a strong mandate. This has led to strong risk-on sentiments, driven by expectations of tax cuts and increased government spending.
“The stock markets hinted at the jubilant mood across industries. Whether good or bad in the long run, the outcome is expected to change the status quo. The impact will be seen on the M&E sector as well if the economic indices improve globally,” said IPG Mediabrands India CEO Shashi Sinha.
Talking about the muted growth in festive ad spends this year, an agency head of a global media agency told BestMediaInfo.com on Tuesday that the uncertainty prevailing due to US elections had dampened the global business sentiments and it had contributed to the below-normal festive season.
Sinha highlighted that the global giants in the consumer products goods categories are overstressed and cutting down their advertising spends.
“Not only the FMCG giants but other businesses across categories were hit by two simultaneous wars in the Middle East and Ukraine. A significant part of the global supply chain was broken. The hostile environment held their investments in the key global markets back. India still is only 5-10% of the global market for large MNCs. So, the global impact on businesses dragged down overall sentiments in India,” Sinha said.
When asked how the outcome of the US elections is expected to fix the economies under stress, Sinha pinned hope on Trump’s anti-war stance.
Trump has been critical of Biden's assistance for Ukraine, fueling concern about the future of support for President Volodomyr Zelenskiy's government under a Republican-controlled White House, Senate and possibly the House of Representatives.
Analysts say it is by no means certain Washington would back any more Ukraine assistance once Republicans control the White House and at least half of Congress, especially as Ukraine experiences battlefield setbacks.
The vice president-elect, U.S. Senator J.D. Vance, has been a vocal critic of Ukraine assistance, arguing that government funds would be better spent on domestic priorities.
“Months after Trump takes over in January, the world is expecting some good news from the war zones. This will have a far-reaching impact on economies worldwide in coming months and year,” Sinha said.
“The wars on multiple fronts raised input cost for most of the categories besides pushing the consumer sentiment in a weaker zone. The industries have a reason to believe that the market would correct,” he added.