The key domestic indices traded with moderate losses in the mid-morning trade after the US president announced a tariff rate of 26% on imports into the US from India. The Nifty traded below the 23,300 level. Metal shares declined after advancing for the previous trading session. At 11:30 IST, the barometer index, the S&P BSE Sensex, declined 259.40 points or 0.34% to 76,357.10. The Nifty 50 index fell 60.55 points or 0.26% to 23,272.95.
In the broader market, the S&P BSE Mid-Cap index shed 0.28% and the S&P BSE Small-Cap index added 0.31%.
The market breadth was positive. On the BSE, 2,463 shares rose and 1,206 shares fell. A total of 181 shares were unchanged.
Trump's Tariff Shock:
US President Donald Trump has announced a sweeping set of reciprocal tariffs, aiming to counter what he calls unfair trade practices. A 10% baseline tariff will be imposed on all imports starting April 5, impacting the United Kingdom, Singapore, Brazil, Australia, New Zealand, Turkey, Colombia, Argentina, El Salvador, the United Arab Emirates, and Saudi Arabia. However, around 60 countries deemed worst offenders'those that impose higher tariffs on US goods or create trade barriers'will face significantly steeper tariffs beginning April 9. These include China (54%), the European Union (20%), Vietnam (46%), Thailand (36%), Japan (24%), Cambodia (49%), South Africa (30%), and Taiwan (32%). While Canada and Mexico are exempt from these new tariffs, they remain subject to previous trade measures tied to border security and fentanyl-related concerns.
Additionally, Trump has also announced a 25% tariff on all foreign-made automobiles, set to take effect at midnight on April 3.
Importantly, no new reciprocal tariffs were announced for the pharmaceutical sector. According to a White House fact sheet, drugs and certain other products'some of which are already subject to existing tariffs'will not be affected by the latest levies. However, Trump has hinted that future tariffs on pharmaceuticals, semiconductors, and other sectors may be unveiled at a later date.
India will face a 25% tariff on steel, aluminium, and auto-related goods, and no tariffs on pharmaceuticals, semiconductors, copper, or energy products. For the remaining products, India will be taxed a reciprocal tariff of 27%.
Buzzing Index:
The Nifty Metal index shed 0.86% to 9,002.20. The index added 0.70% in previous trading sessions.
Vedanta (down 3.22%), Hindalco Industries (down 1.49%), National Aluminium Company (down 1.18%), Lloyds Metals & Energy (down 0.97%) and Jindal Steel & Power (down 0.96%), Welspun Corp (down 0.79%), Steel Authority of India (down 0.76%), JSW Steel (down 0.69%), NMDC (down 0.31%) declined.
On the other hand, Adani Enterprises (up 1.49%) ,Jindal Stainless (up 0.69%) and Hindustan Zinc (up 0.67%) added.
Stocks in Spotlight:
ESAF Small Finance Bank (SFB) rallied 3.38% after the bank announced that its total deposits jumped 17.16% to Rs 23,277 crore as of 31st March 2025 as compared with Rs 19,868 crore as of 31st March 2024.
South Indian Bank rose 0.97%. The private lender said that its gross advances jumped 9.97% to Rs 88,447 crore as of 31 March 2025 as against Rs 80,426 crore as of 31 March 2024.
Interarch Building Products added 1.72% after the company announced that it has received a Letter of Intent (LoI) worth over Rs 300 crore from a new customer.
Lemon Tree Hotels rose 0.82%. The company announced that it has signed a license agreement viz. Lemon Tree Hotel, Jaipur, Rajasthan.
Global Markets:
US Dow Jones index futures tumbled 940 points, signaling a weak opening for Wall Street as markets reacted to President Donald Trump's latest trade offensive. Trump announced a sweeping 10% tariff on all imported goods, with even steeper reciprocal duties for certain nations.
Asia-Pacific markets plunged on Thursday after U.S. President Donald Trump imposed hefty reciprocal tariffs on over 180 countries and territories - several of which are in the region.
In a bold move, Trump unveiled new trade measures on Wednesday, slapping a 24% reciprocal tariff on Japan, despite its status as one of the United States' closest allies. China faces an additional 34% tariff, adding to the existing 20% levies. Meanwhile, the European Union and others will see tariffs ranging from 20% to 49%.
The broad-based tariffs take effect on April 5, while the country-specific hikes begin on April 9. Notably, Canada and Mexico were exempt from the baseline tariffs due to existing agreements, but they will still be subject to 25% duties on most goods.
Additionally, the White House announced a 25% tariff on foreign-made automobiles and key auto parts, set to take effect on April 3, 2025.
Trump defended the move, citing unfair trade practices and currency manipulation, arguing that the tariffs would revitalize American industries and reduce national debt.
Financial markets responded swiftly, with US stock futures plunging on fears of rising inflation and retaliatory measures from key trading partners. Asian markets also slid as investors scrambled for safe-haven assets, worried that Trump's aggressive trade stance could dent global growth.
Before the tariff announcement, US stocks had a volatile session, with major indices posting gains. The S&P 500 rose 0.7%. The Dow Jones Industrial Average added 0.6%, and the Nasdaq composite climbed 0.9%.
Tesla rebounded, surging over 5%, following reports that CEO Elon Musk may step down from his government advisory role to fully focus on the EV company.
Rivian Automotive slumped 6% after reporting a sharp decline in Q1 deliveries, as demand softens.
Ncino plunged 20% after issuing disappointing guidance, missing Wall Street estimates.
CoreWeave Inc extended its rally, soaring 16%, amid reports that Google is in advanced talks to rent Nvidia AI services from the cloud computing firm.
On the macroeconomic front, the US ADP National Employment Report showed that private payrolls increased by 155,000 in March, following an upwardly revised 84,000 gain in February'a sign that the labor market remains resilient despite economic uncertainties.
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