Indian Stock Market Reel Under US Tariff Pressure, Sensex & Nifty Plunge

The Indian stock market faced a downturn for the second day in a row on Thursday, as the United States' decision to impose an additional 25% import tariff on Indian goods took effect on Wednesday. By the close of trading, the BSE Sensex had plummeted by 705.97 points, marking a 0.87% drop to 80,080.57. Concurrently, the Nifty 50 from the National Stock Exchange (NSE) decreased by 211.15 points, or 0.85%, settling at 24,500.90.

With a recent peak of 25,153, the Nifty has now seen a decrease of over 650 points in only five sessions. Ashika Institutional Equities pointed out that Indian markets opened poorly on Thursday as growing concerns over US trade policies negatively impacted investor sentiment, prominently affecting sectors reliant on exports. Throughout the session, benchmark indices exhibited volatility while the Nifty swung between periods of gains and losses.

Investors remained wary with the anticipated release of Q2 GDP data on Friday expected to influence market direction. The August series monthly expiry in the derivatives market contributed to the day's volatility. Ajay Bagga, a Banking and Market Expert, noted global dynamics, stating, "Tariffs were enacted, but no truce arrived. Internal disagreements within the Trump administration are amplifying policy disarray. While the US describes the Ukraine situation as 'Modi's War,' the Treasury Secretary indicated a potential agreement with India."

Sudeep Shah, Head of Technical Research and Derivatives at SBI SECURITIES, observed technical signals of weakness in the Nifty's performance. The index now trades below its 20-day, 50-day, and 100-day Exponential Moving Averages (EMAs), which are all trending downward, signaling increased downward momentum. Such trends suggest short- and medium-term pressures on the index.

Among Nifty constituents, Titan and Coal India registered as top gainers, whereas Shriram Finance and HCL Tech were major laggards. Except for Nifty Consumer Durables, all indices concluded in negative territory. The sectors hit hardest included Nifty IT, Nifty Realty, and Nifty Financial Services, with broader market indices like the Nifty Midcap 100 and Nifty Smallcap 100 also experiencing over 1% losses for the second consecutive day. The market breadth remained negative as the advance/decline ratio favored losing stocks.

Of the Nifty 500 group, only 101 stocks ended the day in positive ground. The Bank Nifty index has underperformed relative to main indices over recent sessions. From its peak of 56,156, it has fallen by over 2,300 points in eight sessions, emphasizing significant selling pressure within the banking sector. (ANI)

(With inputs from agencies.)