Indian stock markets opened in the red on Thursday, mirroring losses across Asian markets after US President Donald Trump announced sweeping tariffs on major trading partners. The move has raised concerns about potential retaliation from affected nations, which could disrupt global trade and economic stability.
Stock Market Reaction
The BSE Sensex declined 0.46%, shedding 355.38 points to reach 76,262.06, while the Nifty 50 dropped 0.41%, or 95.15 points, to trade at 23,237.20 as of 9:57 AM IST.
Across Asia, market indices reflected investor concerns. Hong Kong’s Hang Seng fell 1.75%, the Shanghai Composite declined 0.51%, Japan’s Nikkei 225 plunged 3.14%, and South Korea’s KOSPI slipped 1%.
Tariff Breakdown and Global Implications
Trump’s tariff announcement includes a 26% duty on Indian imports—lower than the 36% on Thailand and 32% on Indonesia but higher than the 24% levied on Japan and Malaysia, 25% on South Korea, and 20% on the European Union. The UK faced a 10% tariff, while Taiwan, a crucial hub for semiconductor manufacturing, saw a 32% tariff imposed.
Addressing the move, Trump stated, “April 2, 2025, will be remembered as the day American industry was reborn, the day America’s destiny was reclaimed, and the day we began to make America wealthy again.”
The new trade policy introduces a base 10% tariff on all countries starting April 5, with additional reciprocal tariffs targeting nations with significant trade surpluses against the US beginning April 9.
Expert Analysis and Sectoral Impact
Vikram Kasat, head of advisory at PL Capital – Prabhudas Lilladher, remarked that the tariffs exceeded market expectations, stoking fears of a full-scale trade conflict. “If no country retaliates, this might be the peak. But if there is retaliation, expect further escalation,” he warned.
Ankita Pathak, a macro strategist and global equities fund advisor at Ionic Asset, highlighted India’s vulnerability. The country exports approximately $80 billion worth of goods to the US, including machinery, pharmaceuticals, electronics, agriculture products, and gems & jewelry. If exemptions are not granted, these sectors could face significant losses.
Meanwhile, Devarsh Vakil, head of prime research at HDFC Securities, suggested that the heightened trade tensions have doubled the probability of a US recession in the next 12 months.
Sectoral Performance in India
The impact of Trump’s decision was evident in early trading as key indices reacted negatively. The Nifty Auto index dropped 1.26%, while the Nifty IT index fell by 2.68%, reflecting investor anxiety over the potential economic fallout.
With trade tensions mounting, global markets are bracing for further volatility, and investors will closely monitor how affected nations respond in the coming days.
