Markets Fail To Recover From Tariff Tensions, Sensex Ends Under 73,850, Nifty Over 100 Points Down

The Indian stock market ended trading on Wednesday in the negative territory. The Reserve Bank of India’s Monetary Policy Committee (MPC) went ahead with a second consecutive reduction in the key interest rates, however, it failed to be enough to boost sentiment in the market.

The MPC opted to slash the repo rate to 6 per cent, and changed its fiscal policy stance to 'accommodative' to help provide a boost to the economy amid global uncertainties. RBI Governor Sanjay Malhotra said that India enjoys a comparative advantage over other countries due to its lower dependence on exports, however, he cautioned that tariffs posed a threat to growth going ahead.

Broader Markets

The BSE Sensex closed trading today at 73,847, plunging close to 400 points, while the NSE Nifty50 settled for the session at 22,420, after falling more than 100 points.

On the 30-share Sensex, Nestle, Hindustan Unilever, PowerGrid, Titan, and UltraTech Cement emerged among the gainers. On the other hand, the laggards included SBI, Tech M, L&T, Tata Steel, and Sun Pharma.

In the broader markets, the Nifty Microcap 250 drove the losses and settled 1.29 per cent lower. Sectorally, the PSU Bank and IT indices declined 2.52 per cent and 2.19 per cent respectively.

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What Led To The Downfall In Markets Today?

Global trade tensions escalated after the US and China failed to back down from a tariff war. After China refused to take back its retaliatory tariffs of 34 per cent imposed in reaction to Trump's tariff measures, the US administration went ahead and levied additional duties on the Asian economy. This brought the total tariffs placed by US on China to 104 per cent.

However, Beijing on Wednesday pledged to take 'resolute and forceful' measures to protect its interests. This triggered a global meltdown in markets with fears of a trade war inching closer to reality and more experts warning about a recession in the coming weeks.

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