New Delhi, India

As Republican presidential nominee Donald Trump clinched a historic victory in the US presidential elections, the global financial markets were rattled and left many investors in a tizzy.

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Before weighing the implications of this economic shake-up, let's first understand the impact of Trump's victory on market indexes, currencies and commodities. 

How global markets reacted to Trump's victory?

As soon as the results were out, the US shares jumped to a record high on Wall Street, the Dow Jones industrial average rallied nearly 4 per cent, the S&P opened 2 per cent higher and amid this market euphoria, the dollar recorded its biggest jump in eight years. 

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Some of the stocks saw a surge in price, especially Elon Musk's owned Tesla and Trump Media. Musk remained a staunch supporter of Trump throughout the election campaign and has a high chance of holding a position in the government. 

Even though Tesla shares rallied on the market, stocks of other electric automakers went into a slump because of Trump's decision to consider putting an end to a $7,500 tax credit for EV purchases on coming to power. 

Also Read: Money-Wise: Have the global stock markets crashed? Here's what you must do

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The small-cap stocks also performed well, as the Russell 2000 index jumped to around 5 per cent, which was its largest rise in one day in two years. Bank stocks also joined the celebrations as they soared in the market. 

In the world of cryptocurrency, bitcoin recorded a historic all-time high because of Trump's position to prioritise the volatile cryptocurrency.

Predicting the global market's future in Trump 2.0, Samir Bahl, CEO - Investment Banking, Anand Rathi Advisors, said to WION, "Investors can be optimistic that a pro-business administration can lead to favourable market conditions and potentially promising returns in the medium term. This administration is also likely to seek decisive settlements to ongoing global conflicts currently impacting global supply chains and market sentiments."

The global markets also remained impacted by the import duties, which included a 60 per cent tariff on imports from China and a 10 per cent universal tariff on imports from all foreign countries.

The victory of Trump initially triggered a sell-off because of which oil fell by more than $2, however, it turned positive later in the day. According to predictions of Citi, Trump's second term is likely to exert pressure on oil in 2025 and Brent crude is likely to remain at an average of $60 per barrel, because of increased oil supply and potential trade tariffs. 

However, speaking to WION, Siddharth Maurya, Founder & Managing Director of Vibhavangal Anukulakara Private Limited, said that election results' "immediate effect would be felt in the case of fossil fuels, infrastructure and domestic manufacturing. Even though there are very high expectations from the presidential policies, it has been established that core drivers of returns would be the Fed policies and the global economy."

The see-saw between US elections and the Indian stock market

The euphoria of Trump's victory was also reflected in the Indian stock market, which rallied through the day and closed in green. Nifty rose to 24,484.05 and the benchmark BSE Sensex closed at 80,378.13, which marked a 901.50 point, or 1.13 per cent jump from the previous day. 

However, the excitement fizzled out in the stock market the next day as investors tried to weigh both the positive and negative implications of the Republicans being at the helm of US politics on the Indian market.

Speaking about the implications of Trump's victory on the Indian market, Maurya said, "The positives could be the strengthening of bilateral relations, Indian IT companies benefitting if US corporates increase spending or US companies increasing the pace at which they move their supply chains from China towards India. There could be some uneasy situations as well because of limitations on immigration policies that impact the provision of IT services, trade restrictions, and world market instability on account of US-China relations."

Watch: US Stocks Rally as Amazon Soars

The Indian rupee also witnessed an all-time low of 84.3775 amid outflows from local equities and expectations that the change in regime would boost the dollar.

So what lies ahead for the Indian market? "The Indian equities market can expect to continue its strong performance after the long overdue correction. While there could be some pressure on India-US trade negotiations, under the Trump administration, U.S.-China tensions could further accelerate the China + 1 policy driving both investors and companies to shift their focus toward India as an attractive alternative market," Bahl explained.

"Nonetheless, investors must remain cognizant of policy impacts on international trade, especially with China, and expected market fluctuations arising from geopolitical choices," Maurya warned.

However, the policies of Trump are likely to catalyse a robust cycle of investment and development in the country's tech and real estate landscapes. 

Emphasising how Trump 2.0 will impact real estate, Samir Bhandari, Co-founder & CFO, hBits - a fractional ownership platform of commercial real estate, said to WION, "As U.S. firms ramp up spending in response to a favourable economic environment, Indian IT companies are likely to benefit from increased demand for services, driving expansion in Global Capability Centres. This growth will not only enhance job creation but also stimulate the commercial real estate sector in tech hubs like Bangalore, Hyderabad, and Chennai."