Equity markets experienced a sharp decline on Tuesday, marking the steepest single-day fall in three weeks. The benchmark Sensex dropped over 1,000 points as concerns about retaliatory tariffs from former US President Donald Trump led to widespread selling across sectors.
The BSE Sensex closed at 76,293.60, down 1,018.20 points or 1.32%, while the NSE Nifty ended at 23,071.80, a decline of 309.80 points or 1.32%. This marked the fifth consecutive session of losses for both indices, with the selloff intensifying in the afternoon.
The negative market sentiment was mainly driven by worries over an escalating tariff war after Trump imposed a 25% import tariff on steel and aluminium. This move raised concerns about its impact on India’s business prospects, leading to a broad-based sell-off.
The market breadth was overwhelmingly negative, with 3,478 stocks declining against just 525 advances on the BSE. Additionally, 479 stocks hit their 52-week lows, while only 55 touched their 52-week highs, indicating the depth of the selloff.
Mid and small-cap stocks bore the brunt of the selling pressure, with the Nifty Midcap Select and Nifty Next 50 falling 2.70% and 2.50% respectively. Among sectoral indices, financial services, healthcare, and realty were the worst hit.
Despite some resilience in the Indian rupee, which strengthened above 86.80 against the dollar, volatility remains high. Technical analysts highlighted significant pressure on the market due to concerns about trade policies, economic growth, and persistent foreign outflows.
Looking at the technicals, analysts noted a bearish trend with the Nifty facing resistance and breaking crucial support levels. They identified key support and resistance levels to watch in the near term.
Overall, market participants are closely monitoring developments such as Prime Minister Modi’s upcoming US visit and US inflation data. However, the heightened volatility and continued foreign outflows suggest that markets may remain under pressure in the near term.
