Sensex below 73,000, Nifty records longest daily fall since 1996

Canada and China announced their own import taxes on US goods

FPJ news Service mumbai

Capital markets around the world fell following the introduction of tariffs by US President Trump on goods entering the US from China, Canada and Mexico. Indian markets were no exception and remained in red on Tuesday. Persistent foreign fund outflows further triggered the downtrend.

The benchmark BSE Sensex declined by 96 points to close below the 73,000-mark at 72,989.93. Nifty recorded its longest daily fall since its launch in 1996. Extending the losses for the 10th straight session, the 50-share NSE Nifty fell by 36.65 points to close at 22,082.65. The index opened below the 22,000 level at 21,974.45 but managed to recover some losses later. FIIs offloaded equities worth 3,405.82 crore on Tuesday, and DIIs bought equities worth Rs 4,851.43 crore.

Canada and China announced their own import taxes on US goods, while Mexico said it had “contingency plans”, sparking fears of full-blown trade war. Following the retaliation, major stock market indices in the US exhibited a declining trend. The FTSE-100 index of the UK’s biggest publicly-listed companies opened lower on Tuesday.

V K Vijayakumar, a senior investment strategist said, “Uncertainty unleashed by President Trump is aggravating in global trade. If Trump’s tariff policy continues, it will be a sad story for global trade and the economy. India will not be spared. There is one factor that will tame Trump, and that is the market reaction. Even mighty Trump cannot influence markets. Tariffs will raise inflation in the US and the Fed can turn hawkish. The US stock market can suffer a severe correction, even a crash cannot be ruled out. In the near-term, there are no chances of a rebound in the Indian market even though valuations are fair. Investors should remain cautious and wait to see how the scenario unfolds.”

Abhishek Jaiswal, a fund manager said that the recent correction has effectively removed excess froth from valuations. With the upcoming Q4 results, we anticipate renewed momentum, positioning small caps for the next phase of growth.

Vinod Nair, a senior researcher said, “The domestic market exhibited a recovery from today’s lows but remained in negative territory due to adverse global cues related to escalating global trade tensions. Nevertheless, the broader market outperformed, primarily driven by value buying opportunities in small-cap stocks. Currently domestic economic indicators are favourable while investors await clarity on global trades for a consistency in momentum.”