Mumbai (Maharashtra) [India]: Indian stock markets opened sharply lower on Tuesday, mirroring a global sell-off following a steep decline in U.S. markets. The downturn was attributed to the “Trump Uncertainty Discount,” which is disrupting global supply chains and fueling economic concerns.
The Nifty 50 index started at 22,345.95, marking a drop of 114.35 points (-0.51%), while the BSE Sensex plunged 371.29 points (-0.50%), opening at 73,743.88.
Market experts linked the decline to uncertainty surrounding the Trump administration’s tariff policies, which have significantly impacted investor sentiment in the first 50 days of his tenure. Analysts suggest that traders have no choice but to adopt a wait-and-watch approach until more clarity emerges.
Expert Insights
Ajay Bagga, Banking and Market Expert, explained the broader impact:
“US markets sold off strongly in reaction to the Trump Uncertainty Discount that is pervading global supply chains, economies, geopolitics, and trade. The Atlanta Fed GDP Now forecast is now showing a degrowth of -2.4% for US GDP in Q1, 2025.”
He further noted:
“The question facing markets is, how has sentiment turned so much that from all-time high US markets and US Economic Exceptionalism, the sentiment has turned sourly risk off? The answer lies in the chaos and uncertainty unleashed by the Trump administration in its first 50 days. There is no option but to hunker down and wait out the next two months and hope for some clarity to emerge.”
Sectoral Impact in India
A broad-based sell-off was observed across sectors, with IT stocks, metal stocks, and media stocks facing the sharpest declines. The Nifty Bank index also slipped over 0.7% during early trading.
Out of the 50 stocks in the Nifty 50 index, only five opened with gains, while the rest were under selling pressure.
Market analysts blamed the Trump administration’s policy decisions, calling them “rank bad decisions”, executed without comprehensive analysis, leading to frequent rollbacks and increased uncertainty. However, they believe that portfolio managers can still mitigate risks through strategic asset management.
Global Market Trends
The sell-off was not limited to Indian markets—Asian indices also suffered sharp declines:
- Nikkei 225 dropped 1.7%
- Hang Seng Index fell 0.93%
- Taiwan Weighted Index declined 1.86%
- South Korea’s Kospi Index slipped 1.23%
In the U.S., the impact was even more severe, with the Nasdaq plunging 4% and the S&P 500 closing 2.7% lower on Monday, setting off a domino effect in global markets.