Indian Stocks Fall on US Tariff Fears: Market Update

Indian Shares Fall as Investors Fret Over US Tariff Impact

India's benchmark indexes reversed early gains on Friday as investors remained concerned about the potential implications of reciprocal U.S. tariffs.

Market Performance

As of 11:45 a.m. IST:

• The Nifty 50 was down about 0.5%.
• The BSE Sensex was also down about 0.5%.

Background

U.S. President Donald Trump stated that Indian Prime Minister Narendra Modi offered to discuss easing tariffs, buying more U.S. oil and gas, combat aircraft, and concessions during their meeting at the White House.

Furthermore, Trump is considering plans for reciprocal tariffs on every country taxing U.S. imports, which has sparked worries of a global trade war. While the imposition of these duties may be delayed, the concerns persist.

Expert Analysis

Sanjeev Hota, vice president and head of research of wealth management at Mirae Asset Sharekhan, noted:

• "While the delay in imposition led to a flat open in markets, it's not as if the tariff concerns have gone away."
• "The worries still remain."

Investors remain concerned about the potential consequences of U.S. tariffs on the Indian rupee and U.S. rates, which could trigger further foreign outflows.

Sectoral Performance

The impact was widespread across sectors:

• Twelve of the 13 major sectors declined on the day.
• Drug makers, with significant revenue exposure to the U.S., fell the most, down 2.7%.
• High-weightage financials fell 0.7% after the Supreme Court dismissed telecom companies' review petitions.

Impact on Broader Market

Smallcaps and midcaps also experienced significant declines:

• Smallcaps fell 2.9%.
• Midcaps fell 2.2%.
• These declines were attributed to fears of slowing corporate earnings and stretched valuations.
• They are currently trading at 21% and 19.5% lower from their record closing high levels in December and September, respectively.

The market's reaction highlights the sensitivity to global trade developments and their potential impact on the Indian economy.

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Categories: Indian Stocks, market news, US tariffs