Markets: Trump tariffs, FII outflow drag Indian, world stocks down
Virendra Pandit
New Delhi: Fears of the long-term impact of fresh Trump tariffs, that may potentially reignite an international trade war, and the unabated outflow of FIIs, among other reasons, pulled down benchmark stock indices Sensex and Nifty as they tanked more than 1% on Tuesday.
Sliding down for the fifth day in a row, the 30-share BSE Sensex dropped 1,018.20 points, or 1.32 percent, to settle at a two-week low of 76,293.60. The NSE Nifty cracked 309.80 points or 1.32 percent to close at 23,071.80 with 44 of its constituents closing lower and six with gains.
At close, on BSE, Zomato, Tata Steel, Bajaj Finserv, Tata Motors, Power Grid were among the top laggards. Similarly, on NSE, Eicher Motors, Apollo Hospitals slipped over 6 percent, Shriram Finance was down over 4 percent, Bharat Electronics (BEL) and Coal India were down over 3 percent and were the top five losers.
US President Donald Trump’s fresh tariffs on steel and aluminium imports by a flat 25 percent is raising worries for the investors. Besides, his plans to impose ‘reciprocal tariffs’ on other countries over the next two days is also causing concerns across world markets, as these could hurt emerging Asian economies like India, China and Thailand more than the developed Asian economies (Hong Kong, and Singapore).
Ahead of Prime Minister Narendra Modi’s meeting with President Trump in Washington DC this week, the fresh move may be negative for India as US is the country’s largest export destination, accounting for nearly 18 percent of Indian exports (2.2 percent of the GDP in FY24), with the India-US trade surplus rising in recent years to a high of nearly USD 38 billion in 2024.
Foreign Institutional Investors (FIIs) are continuously selling Indian equities, which is denting market sentiments. On Monday, the FIIs sold Rs 2,463.72 crore worth of equities. As per NSDL data, FIIs have sold Rs 78,027 crore in January and so far they have sold Rs 85,841 crore worth of equities.
In Asia, Chinese stocks traded lower after Trump imposed tariffs on steel and aluminium imports with mainland China CSI 300 slipped 0.40 per cent, Shanghai down 0.12 per cent and Hong Kong’s Hang Seng was down over 1 per cent. Japan’s Nikkei was flat with positive bias.
Meanwhile, in the European region, Germany’s Dax was flat with positive bias, United Kingdom’s FTSE was up 0.15 per cent and French stock market index CAC was up 0.12 per cent.
