Markets experienced significant declines for the sixth consecutive session on Friday, with the Sensex plunging 733.22 points (-0.90%) to finish at 80,426.46. This drop followed the United States’ announcement of an immediate 100% tariff on imports of branded and patented pharmaceutical products, set to take effect on October 1. The Nifty 50 saw a similar fate, decreasing by 236.15 points (-0.95%) to close at 24,654.70, dipping below the crucial 25,000 mark.
The surprise tariff measure sent reverberations through Indian equities, exacerbating an already fragile investor sentiment amid concerns over recent increases in H-1B visa fees. “Indian equities ended sharply lower on Friday in a broad-based sell-off after the US announced a steep 100% tariff on imports of branded and patented pharmaceutical products effective October 1,” stated Ponmudi R, CEO of Enrich Money. He noted that the unexpected shift rattled the market, which was still reeling from the prior week’s selling in IT stocks.
The BSE Healthcare index suffered significant losses, correcting approximately 5% over the week due to the tariff announcement. The BSE IT index also fell sharply, down 7% for the week as Accenture’s weaker guidance and job cuts reflected a slowdown in IT spending. “Accenture’s announcements pointed to slowing IT spending, with AI-driven growth failing to meet expectations, prompting a broad sell-off in tech shares,” commented Vinod Nair, Head of Research at Geojit Investments Limited.
Market breadth exhibited severe weakness, with 3,100 stocks declining compared to just 1,041 that advanced on the BSE, which saw a total of 4,280 stocks traded. There were 154 stocks hitting 52-week lows versus 132 reaching new highs, along with 6 stocks locked in lower circuits compared to 12 in upper circuits.
Among Nifty 50 stocks, Larsen & Toubro was the top gainer, increasing 2.71% to ₹3,743 from ₹3,644.40. Tata Motors rose by 1.45% to ₹673.95 and ITC gained 1.22% to ₹405. Eicher Motors and Reliance Industries followed with gains of 0.70% and 0.48%, respectively.
On the downside, IndusInd Bank led the losses, plummeting 3.88% to ₹712 from ₹740.75. Mahindra & Mahindra fell 3.68% to ₹3,400, while Tata Steel dropped 2.92% to ₹167.35. Bajaj Finance saw a decline of 2.74% to ₹985.
Broader market indices experienced even larger declines, with the Nifty Midcap 100 tumbling 2.05% to 56,378.55, and the Nifty Next 50 index falling 1.68% to 67,144.95. Banking stocks were particularly under pressure, with the Nifty Bank down 1.07% to 54,389.35 and Nifty Financial Services decreasing by 1.00% to 25,985.25.
“Risk-off sentiment continued in equity markets, as markets extended their losing streak for a sixth straight session amid broad-based selling triggered by Trump’s decision to impose a 100% tariff on branded and patented drugs, which further soured investor sentiment,” said Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd. He noted that the market was facing multiple challenges, including heavy foreign institutional investor (FII) selling, US-India trade uncertainty, a depreciating rupee, and the allure of bullion, which all contributed to investor jitters.
Foreign institutional investors continued their selling trend, recording outflows of ₹13,882 crores over the last four sessions, exerting additional pressure on the market. The Indian rupee remained weak, trading flat at approximately 88.71 against the dollar amid ongoing FII selling. Jateen Trivedi, VP Research Analyst at LKP Securities, explained that the rupee’s stability at around 88.71 coincided with a range-bound dollar, influenced by recent stronger US GDP figures.
Gold prices provided a slight respite for investors, trading firm at ₹1,14,000, up marginally by ₹130, as global uncertainties drove demand for safe-haven assets. “Gold prices showed firmness at ₹1,14,000 as Comex Gold maintained stability while global market conditions remained cautious,” Trivedi added.
The overall performance for the week was grim, with the Nifty declining 2.65% and the Sensex shedding 2,200 points. “This week, negative sentiment pervaded Indian equity markets as they absorbed the ramifications of the US tariff announcement and the impacts on the pharma sector,” remarked Shrikant Chouhan, Head of Equity Research at Kotak Securities.
Technical analysts articulated caution regarding the immediate outlook. “Markets are under pressure and extended their losing streak for the sixth straight session,” said Ajit Mishra, SVP Research at Religare Broking Ltd. He commented that the Nifty is approaching key support near 24,400 and recommended a cautious investment strategy, focusing on fundamentally strong stocks while avoiding aggressive bets until clearer signals emerge.
Looking forward, market participants will be monitoring for policy clarity and management commentary to gauge potential impacts on sectoral earnings and global trade dynamics. With the monthly futures and options expiry approaching next week, heightened volatility is anticipated. Nilesh Jain, Head of Technical Research at Centrum Broking Ltd, indicated expectations for the Nifty to trade within a broader range of 24,300 to 25,100.
