D-street stumbles as fresh tariff fears in slowdown feed

Copyright © HT Digital Streams Limit all rights reserved. Markets Dipti Sharma 4 min Read 04 Apr 2025, 10:02 AM IST on Friday, the Nifty 50 dropped 1.5% to close at 22,904,45, while the Sensex fell 1.2% and ended at 75,364,69. (Mint) Summary of Trump’s threat of slapping rates on pharmaceutical scheme has dampened the hope in a sector that stood out the day before. Mumbai: A game of weakness in Asian markets wasted in Indian stocks on Friday, which arose a sale that swept over sectors. Indian markets that occur a steep fall a day earlier have dropped 1.5%as the fear of a US recession and its effects has grown. An important victim was the pharmaceutical sector, which US President Donald Trump promised to target next. The Nifty 50 dropped 1.5% to close at 22,904.45, while the Sensex fell by 1.2% and ended at 75,364.69. The smaller shares achieved a bigger hit, with a nifty Midcap -100 -tumbling 2.9% and a Nifty Smallcap 250 that plunged 3.3%. Elsewhere, Hong Kong’s Hang Seng, China’s Shanghai compost, Japan’s Nikkei and South Korea’s KOSPI fell 1.5%, 0.2%, 2.8% and 0.9% respectively. Nifty Pharma, who performed a day earlier, fell by 4%and became the second worst performer among NSE sectors, just behind Nifty Metal who dropped 6.6%. All sectoral indices ended the day in the red, with a Nifty FMCG that closed flat. Overnight, Trump said he plans to set up pharmaceutical rates at a level you haven’t seen before ‘. Read also | Stock market pain begins. “This is how you sabotage the world’s economic engine the day before, the market response was” surprisingly better than expectations “, said Gaurav Dua, senior vice president and head of capital market strategy at Mirae Asset Sharekhan, while investors acquired hope from India’s relatively lower reciprocal rates rates. He also believes that Thursday’s weekly expiry could also play his role in limiting the damage. “Continued poor global clues and the possibility of negative growth in the global economy led to it selling today,” Dua added. The tariff shock is likely to reflect in US inflation and growth prospects in the coming weeks. Investors are expected to carefully watch the most important indicators on jobs, inflation and retail sales to determine the health of the US economy. Any softening of data may have concerns about a recession or stagflation in the US, which is more investing. According to Mark Haefele, investment officer, global wealth management at UBS, there is a 50% chance that the US rates are being traced back to negotiations. Despite such a reduction by the end of the year, the immediate shock is expected to slow down the US economy, bringing 2025 growing closer to or below 1%, he said in a April 3 note. Read also | Nifty’s sharp drop is also led by Tata Steel, TCs, Tata cars, Hindalco industries and Sun Pharmaceuticals, can wither under our reciprocal tariff weight. Nevertheless, Indian stocks have fared better than most, which hindered Taiwan and Indonesia, which falls the smallest since Trump’s tariff bomb. Analysts at Bernstein believe that India is well positioned to navigate the tariff challenges and is likely to prefer negotiations above escalation. “The immediate negative sentiment must be visible in the markets, but we still retain our second half macro recovery thesis and consider a potential trade agreement with us as a positive long -term development,” the April 3 report on April 3. The most important risk, they added, lies in a possible US recession affecting certain sectors. According to the preliminary BSE, FIIs sold Indian shares worth £ 3,483.98 crore on Friday, while DIIS only sold shares worth £ 1,720.32. Read also | Don’t blame Trump for all the problems of the stock market, hope for India Feroze Azeez, Deputy CEO of Anand Rathi Wealth, no other emerging economy is just as well placed as India to take advantage of current global trade shifts. He also pointed to the solid macro prospects of India, with the Q3 FY25 GDP growth at 6.2% and strong tax collections that help keep the fiscal deficit on track. “Considering these factors, we expect the nominal GDP growth to remain between 10-11% in the coming years and position India as one of the fastest growing economies under emerging markets,” he said. Meanwhile, Prashant Khemka, founder of Whiteoak Capital Management, said: “India has come off a lot of light (in terms of imposition of reciprocal rates)”. While other countries are hit hard by rates, India can actually get a break, with higher rates elsewhere that gradually shifts the market, he said. With a long -standing concern about a US recession, he expects foreign investment flow to get in line gradually. However, if the US market underperforms or even in line with emerging markets, the return may be faster, he added. Read also | Will lower rates attract FPIs from other emerging markets? “Continuing macroeconomic stability, successive decline in inflation, green shoots in rural growth and RBI’s rate reduction cycle are signs of optimism for Indian markets. Securities, said ongoing policy uncertainty.