Global Trade Tension Weighs on Indian Markets Amid US Tariff Uncertainty

On Friday, Indian stock markets made a somber start, reflecting global anxieties tied to persisting U.S. tariff policies. The unexpected move by the U.S. Federal Appeals Court allowing the Trump administration's tariff strategy to continue until a higher court's verdict intensified global market uncertainties.

At the opening bell, the Nifty 50 index dropped 21 points, or 0.08%, to 24,812.60, while the BSE Sensex saw a decrease of 167.33 points, or 0.20%, settling at 81,465.69. This downturn mirrors the broader negative sentiments prevailing across major Asian stock indices. Analysts suggest this cautious approach may persist amid the ongoing tariff uncertainty.

Ajay Bagga, a Banking and Market Expert, remarked on the mixed market dynamics, noting the reduced volatility despite it being an expiry day. Bagga highlighted strong capital inflows and anticipations for robust GDP figures for India, alongside consistent domestic fund flows which contribute to an optimistic outlook for Indian markets. Yet, he noted, the convoluted U.S. policy environment remains a significant concern for risk markets. He expressed hope for resolution around the tariffs by July, which could guide market positioning as early as June.

Sector-wise, there was widespread pressure with Nifty IT leading the losses at a 0.9% decline. Nifty Pharma, Nifty Metal, and Nifty FMCG also logged losses, though largely contained, with broader market indices showing varied performances. While Nifty Small Cap and Nifty Midcap indices traded positively, Nifty 100 opened in the red.

The ripple effect of tariff-related anxieties was evident across Asian markets with Japan's Nikkei 225 down over 1.4%, Hong Kong's Hang Seng falling 1.47%, and South Korea's KOSPI decreasing by 0.61%. This shared negative sentiment underscores the lingering global economic unease.

As the day unfolds, investors are keen on domestic GDP statistics for potential positive signals that might bolster market sentiment, even if temporarily. (ANI)

(With inputs from agencies.)