US President Donald Trump’s tariff moves on Canada, Mexico and China spooked the Indian markets on concerns of a trade war and sent the benchmark indices down over half a per cent, while the Indian rupee slid below ₹87 to the greenback.
The Nifty50 fell 0.5 per cent to 23,361.05 points at close and the Sensex ended 0.4 per cent lower at 77,186.74 points. The broader market saw sharper losses with the NiftySmallCap 100 falling 2.1 per cent and the NiftyMidCap100 down 0.9 per cent.
Foreign portfolio investors sold equities worth ₹3,958 crore, while domestic institutional investors were net buyers to the tune of ₹2,708 crore. Asian and European stocks also slumped on tariff fears.
Volatile day
The trading day was volatile with the morning session seeing deep cuts of over 1 per cent in the benchmark indices, that were under significant pressure in early trades. But during the day, the stocks clawed back some of their losses and the indices recovered. “The Indian stock market experienced turbulence today as investors grew increasingly wary of potential global trade disruptions following President Trump’s tariffs,” said Devarsh Vakil, Head of Prime Research, HDFC Securities
“It was a mixed session, as prices held strong at key support levels after the early decline, leading to consolidation. Despite the anticipation surrounding the Budget session, there’s a minimal impact on Nifty’s price action,” said Rajesh Bhosale, Technical Analyst, Angel One.
Key events
There are key events later in the week such as the Delhi elections on Wednesday and the RBI Monetary Policy Committee’s decision on Friday on policy rates. “Traders seem to be awaiting clarity from these events, but till then, we could see some choppy moves within a defined range for the key indices,” said Bhosale.
The Nifty PSE index fell over 3 per cent, with investors shunning these stocks, disappointed by the Budget allocations.
Road infrastructure and railway-related stocks fell for the second consecutive day following the modest expenditure estimates by the government in the Budget.
Engineering and infrastructure major Larsen & Toubro dragged down the index with a fall of 4.6 per cent. Over the next few days the main indices are expected to trade within a narrow range, as investors wait to further events to unfold domestically and globally.