US President Donald Trump’s tariffs have caused havoc around the world, wiping out investor value of over Rs 20 lakh crore in a matter of seconds and sending Indian equity markets to their lowest level in ten months. The Nifty fell more than 1,000 points this morning, and the Sensex opened almost 4,000 points lower, down more than 3.5% since its last trading session.When trading starts this evening, US futures are predicting large losses, and the drop comes after a big sell-off in Asian markets, which was prompted by Trump’s extreme policies.As panic selling persisted, European markets also fell.
The tariffs – billed as the harbinger of a “golden period” for US industries – seek to undo trade practices that President Trump believes have been unfair. The tariffs are country-specific and go as high as 50%. The rate announced for India is 26%, which has set off fears among exporters and traders, in addition to a 10% baseline duty applied to all nations.
A defiant Trump appeared unmoved by the bloodbath in global markets, equating his tariffs with a medicine that is required to “fix something” while speaking to reporters this morning.
Indian Equities Lose 3.5%
Sensex crashed 3, 939.68 points to 71,425.01 in early trade as trading resumed at 9 am after the weekend holidays. Nifty tumbled 1,160.8 points to 21,743.65 during this period. Sensex, a pack of India’s top 30 companies listed on the Bombay Stock Exchange, was down over 3,000 points at noon, while Nifty, the National Stock Exchange index, dropped below the 22,000 mark.
The rupee also opened lower this morning, falling 30 paise to 85.74 against the US dollar.
Analysts suggest Trump’s tariffs were bound to cause fears in Indian markets and that the country now needs financial reforms to protect its domestic economy from the global trade war.
“India will face the heat, not due to domestic reasons, but as an interlinked chain in the global portfolio flows. India will need a fiscal, monetary, and reform package to protect the domestic economy from this global economic winter that is threatening to settle in,” Ajay Bagga, a market expert, told ANI.
Sunil Gurjar, SEBI-registered research analyst, said Nifty50 has plunged through the first support level and is nearing the second, and a further breakdown would only extend the downward trend.
Global Equities
Asian equities, the first among all markets to open, have been hit the hardest as Trump tariffs extended a massive sell-off on the bourses in China, Japan, Taiwan, and Hong Kong.
In China, where the Communist government has retaliated against the US with 34% tariffs, stocks have crashed over 4% while the Hang Seng index is down by over 10% in Hong Kong. Nikkei in Japan is down at least 6.5% after crashing over 8% in early trade. Taiwan’s main index collapsed nearly 10% and Singapore’s over 8%.
European markets extended the losses with German stocks crashing 10% and French equities diving 4%. London indices too fell nearly 6% while Amsterdam and Oslo saw losses of about 5% and Milan was down by over 3%.
Wall Street is also in a dire state. Significant losses were anticipated when the US markets opened on Monday, according to the dramatic decline in futures contracts on the New York Stock Exchange.
In addition to causing a stock market meltdown, Trump’s trade policies have raised concerns about a worldwide recession, and market analysts have expressed alarm about his disobedience.Stephen Innes of SPI Asset Management worries that a worldwide recession might be on the horizon.”The market is once more plunging through floors in free-fall mode. The Trump team is not giving up. Tariffs are not being used as a negotiating chip, but rather as a victory lap.
