Gautam Chhaochharia, Head of Global Markets, India at UBS, believes that while Trump’s policies may impact global markets, the Indian market’s key drivers will be local policy decisions.

“Will RBI respond to slowing growth? Will we see some policy action from the central government, which we haven’t seen till now or will we even see some positive surprise on the reforms agenda post all the state elections are done? Those are the things will be bigger drivers of the local market in India, beyond what’s happening globally,” he said.

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Chhaochharia remains cautiously optimistic on India’s economic growth and earnings outlook, despite recent signs of a slowdown.

He expects earnings to recover and highlights the role of policy support, with a consensus expectation for rate cuts over the next six to nine months. “So that should support from a top down perspective as well as bottom up. We have seen signs of pickup in rural already. So, early growth should pick up from here,” he noted.

However, he added that it’s uncertain if this will be enough to lift markets, given current valuations despite the recent correction.

In terms of sectoral positioning, UBS has moderated its view on industrials, trimming exposure due to valuation concerns and company-specific order book momentum.

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Chhaochharia explains that consumer sectors, especially those tied to rural recovery, appear better positioned to withstand volatility, offering defensive benefits alongside growth potential.