Mumbai (Maharashtra) [India]: Indian stock markets opened in the green on Wednesday, displaying resilience despite concerns over US President Donald Trump’s announcement of reciprocal tariffs starting April 2. The BSE Sensex commenced the session 162.63 points higher at 73,152.56, while the Nifty 50 rose 52.85 points, opening at 22,135.50.
The market displayed cautious optimism, with 30 Nifty companies advancing and 20 declining. Among the top gainers were M&M, Power Grid, HCL Tech, BPCL, and Adani Ports. On the flip side, Bajaj Finance, Bajaj Finserv, SBI Life, HDFC Bank, and Sun Pharma emerged as the biggest laggards in early trade.
Global Impact and Expert Insights
The announcement of US tariffs has sent ripples across the global markets, affecting companies from Japan to Mexico, which are now bracing for higher prices, lower demand, and supply chain disruptions. Ajay Bagga, a Banking and Market Expert, commented on the impact, stating:
“Trump Tariffs impacted global markets on Tuesday with companies from Japan to Mexico bracing for disruptions, higher prices and lower demand as business and consumer confidence is hurt by the unpredictable Trump policy regime.”
He further highlighted the historical significance of these trade actions, comparing them to the protectionism of the 1930s during the Great Depression.
“The tariff actions on friends and foes alike is something not seen since the 1930s protectionism at the height of the Great Depression,” Bagga added.
China’s Response and India’s Position
In response to the growing trade uncertainties, China announced a fiscal stimulus, proposing a 4% fiscal deficit for 2025 to target a 5% GDP growth amid challenges to its exports.
On the Indian front, there is hope for a resolution to the tariff issue, with Union Minister Piyush Goyal currently in the US for trade discussions. Bagga cautioned that while domestic economic momentum remains strong, global pessimism could weigh on investor sentiment.
“For India, there is hope for some kind of an agreement to avoid mutual tariffs… Indian markets will be impacted by the global risk-off and despite domestic economic momentum picking up, the global pessimism will translate into a cautious market outlook,” he warned.
Market Recovery and Analyst Expectations
Akshay Chinchalkar, Head of Research at Axis Securities, noted that despite opening higher, the Nifty ended slightly lower, marking its 10th straight day of decline—a first in history.
“The Nifty recovered from its initial weakness to finish slightly lower and in doing so ended down for the 10th straight day for the first time in history. There are signs that the broader benchmarks are attempting a recovery, but a trigger is awaited,” Chinchalkar stated.
Looking ahead, analysts suggest that global uncertainties will likely dictate the near-term trend of the Indian markets, especially with US-India trade talks underway. Investors are expected to keep a close watch on policy responses from major economies as they navigate the challenges posed by rising protectionism and economic slowdowns.