Stock markets across Europe were shaken after France’s second prime minister in a month resigned, intensifying the country’s political instability. Sebastien Le Corneille, the prime minister of France, the second-largest economy in Europe, tendered his resignation yesterday, and President Emmanuel Macron promptly accepted it. Le Corneille, who stepped down just hours after a cabinet reshuffle, now holds the record for being the shortest-serving prime minister in French history.
Le Corneille’s exit marks the fourth prime ministerial resignation in France within a year. Since President Macron began his second term in 2022, six prime ministers have quit, signalling deep internal divisions within the ruling party. Persistent disagreements over governance priorities and reform strategies have plagued Macron’s administration. Despite mounting pressure from opposition leaders to dissolve parliament and call fresh elections, Macron has thus far resisted, asserting his mandate runs until 2027.
France’s renewed political uncertainty has rattled both the stock market and the euro. The French CAC 40 index fell 2%, while the euro slipped 0.3% against the US dollar. Major European indices also mirrored the decline, the pan-European Stoxx600, Germany’s DAX, and the UK’s FTSE all closed in the red. Investors are increasingly worried about the economic outlook for Europe amid political turmoil in France and escalating global trade tensions.
Trump’s tariff war intensifies, shaking global trade
Meanwhile, US President Donald Trump has reignited global economic concerns by escalating his tariff offensive. In a fresh blow to international trade, Trump announced a 25% import tariff on medium and heavy trucks entering the US, effective November 1. This comes on the heels of a sweeping 100% tariff on imported medicines, part of his administration’s broader push to “protect American industries.”
Trump has also raised import duties on furniture and bathroom vanities to 25%, with plans to double them to 50% soon. His latest move to increase tariffs on aluminium, steel, and copper to 50% has been described as a major setback for all key trade partners of the US. The White House’s new tariff structure also includes a 10% base tariff and country-specific duties ranging between 10% and 40%, depending on the commodity.
India and Brazil have been hit hardest, facing a cumulative tariff burden of up to 50%. However, Brazil has expressed its willingness to resume talks with Washington. The negotiations between India and the US on a comprehensive trade deal still continue. Trump had initially imposed a 25% tariff on Indian goods but later extended an additional 25% levy on Russian crude imports.
Despite these pressures, India’s trade and industry sectors remain resilient. Policymakers have emphasised diversification of export markets and domestic manufacturing to reduce dependency on tariff-affected sectors. Analysts believe India’s robust internal demand and growing self-reliance initiatives will help cushion the economy from external shocks.
India shines amid global gloom as markets stay strong
Back home, Indian markets opened on a cautious note today. The GIFT Nifty traded 0.09% lower in early hours, following a weak global trend. However, despite similar global headwinds yesterday, both the Sensex and Nifty managed to close in positive territory, reflecting strong domestic fundamentals.The Sensex surged 582 points (+0.72%) to close at 81,790, while the Nifty gained 183 points (+0.74%) to settle at 25,077. Crossing the 25,000 mark for the Nifty has boosted investor sentiment. The rally was supported mainly by banking stocks that reported robust business performance for the September quarter. IT stocks also witnessed renewed buying interest, further strengthening market confidence. In the US, futures trading signalled mild weakness, with Dow Jones futures down 0.14%, S&P futures off 0.12%, and Nasdaq futures declining 0.13%. The uncertainty surrounding the unresolved government shutdown negotiations weighed on investor confidence.
In corporate developments, Adani Green Energy secured its first foreign loan since the recent US bribery controversy, signalling renewed investor trust. Aster DM Healthcare’s merger with Quality Care India has received the necessary regulatory approvals and is expected to reflect positively on the company’s shares. Meanwhile, Mahindra & Mahindra launched its new Bolero SUV, featuring premium design elements and enhanced features, strengthening its presence in the domestic auto market.
Gold surges as global uncertainty deepens
Gold prices soared globally amid heightened geopolitical and economic uncertainties. The international price jumped by over $80 per ounce, reaching an all-time high of $3,977.39, edging close to the critical $4,000 mark. Analysts attribute the rally to expectations of a possible US interest rate cut and persistent fears surrounding the Trump administration’s shutdown crisis.
In India, the surge in gold prices has further strengthened the yellow metal’s appeal as a safe-haven asset. However, the corresponding rise in crude oil prices could put pressure on the rupee. Following OPEC+’s decision to increase output without announcing the anticipated production hike, crude prices edged higher, with WTI trading at $61.74 and Brent at $65.54 per barrel, up by 0.11%. If this trend continues, analysts warn that the rupee could approach the 90 per dollar mark in the near term. Nevertheless, India’s strong foreign exchange reserves, steady domestic consumption, and prudent monetary policy are expected to provide a buffer against global volatility.
Despite the global headwinds, India’s markets continue to demonstrate remarkable resilience, supported by a strong banking sector, steady IT growth, and investor confidence in long-term fundamentals. As global economies grapple with political instability and protectionist trade policies, India’s balanced fiscal management and domestic-driven growth model stand out as a pillar of stability in an increasingly uncertain world.
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