India-US Trade Deal Sparks Diwali-like Mood in Stock Market: Madhusudan Kela

• Veteran investor Madhusudan Kela predicts a strong return of foreign investors (FIIs) to the Indian market, likening the sentiment to Diwali.
• He believes the combination of domestic buying and fresh FII investment will drive the market to new highs, with recent lows potentially being the year's bottom.
• The trade deal with the US has dispelled concerns about India-US relations, paving the way for significant FDI announcements.
• Kela expects a bounce back in midcap and smallcap segments, which saw massive selling recently, and increased interest in tariff-affected companies.
• Financial sector stocks and large, liquid companies are expected to attract foreign investors, shifting focus from concerns like STT hikes to growth.

Why It Matters: India-US trade deal and strong domestic-foreign investment convergence signal a new bullish phase for the Indian stock market.