Sensex, Nifty Tank In Red as Trump’s Tariff Plans Trigger Global Trade War Fears
India’s stock market stumbled at the opening bell on Tuesday, with the S&P BSE Sensex plunging 368.03 points to 72,717.91 and the NSE Nifty50 sliding 136.30 points to 21,982.70. The sharp decline follows US President Donald Trump’s announcement on Monday that 25% tariffs on goods from Mexico and Canada will kick in today, rattling global financial markets and stoking fears of an escalating trade war.
The tariffs, combined with an existing 20% levy on China—plus an additional 10% hike—have sent shockwaves through economies worldwide. Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, warned that Trump’s actions are turning threats into reality. “The uncertainty is shaking global trade. Responses from affected countries are coming, and India won’t escape the fallout,” he said.
Analysts say Trump’s aggressive tariff policy could disrupt international commerce, raising costs and slowing growth. For India, which exports $38 billion worth of goods to the US annually, the ripple effects could hit hard. Tuesday’s market drop reflects this growing unease, with investors dumping stocks amid the chaos.
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Vijayakumar predicts that the US market itself might force Trump to rethink his strategy. “Tariffs will drive up inflation in the US, and the Federal Reserve could tighten policy. A stock market crash—something Trump dreads—might finally tame him,” he explained. However, no one knows when or if this will happen.
For now, India’s markets look bleak. Despite fair valuations after a rough patch—Sensex is down 14.86% from its September 2024 peak of 85,978—experts see no quick recovery. Foreign investors have pulled out $25 billion since September, and the rupee hit a record low of 88 against the dollar last week. “Stay cautious,” Vijayakumar advised. “Wait and watch how this unfolds.”
Tuesday’s losses echo a global trend. Asian markets like Tokyo and Shanghai fell up to 3%, while Wall Street ended lower on Monday. As Trump’s tariff gamble plays out, Dalal Street braces for more volatility, with investors hoping for calmer days ahead.
