Introduction
The stock market faced a major jolt on Monday as benchmark indices fell sharply due to new tariffs announced by U.S. President Donald Trump. The Sensex dropped significantly while the Nifty also witnessed a steep decline, shaking investor confidence worldwide.
Asian Markets Sink Following Tariff Announcements
Global panic hit early trading sessions in Asia. Japan’s Nikkei 225 tumbled nearly 8%, Australia’s ASX 200 lost over 6%, and South Korea’s Kospi dropped 4.4%. Oil prices also fell by 4%, signaling global economic concerns.
This sell-off followed Friday’s Wall Street crash, triggered by the newly imposed U.S. tariffs. The ripple effect of these actions stoked fears of a global recession, especially as major U.S. companies with ties to China posted heavy losses.
Indian Markets React: Sensex and Nifty Slide Sharply
The stock market in India saw a brutal opening. The Sensex plunged by 3,914 points, opening at 71,449.94 — a 5.19% drop. The Nifty 50 slipped by 1,146 points, starting the day at 21,758.4, a 5% fall.
However, in the final hour, a modest recovery was seen. The Sensex closed at 73,137, gaining back 500 points, while the Nifty settled at 22,161 after recovering 200 points.
Indian IT Sector Faces Uncertain FY26 Outlook
Experts are now revising their forecasts for the Indian IT industry. With the U.S. market facing turmoil, growth predictions for FY26 appear weak. Discretionary spending, especially in retail and manufacturing, may remain subdued for the foreseeable future.
Analysts warn that the next few months could bring downward revisions in earnings and conservative guidance from top firms, further pressuring investor sentiment.
Debt Market Surge as Yields Drop
Taking advantage of falling bond yields, Indian companies are expected to raise $4.5 billion via bonds in the first week of April. Typically conservative at the start of a fiscal year, firms are now leveraging low borrowing costs for early capital access.
Short-term corporate bond yields dropped by 25-30 basis points, prompting at least 15 firms to tap into the debt market — an unusual move that highlights how volatile the stock market has become.
European Stocks Also Tumble Amid Trade War Fears
European indices, too, took a hit. Germany’s DAX dropped 5.3%, and the UK’s FTSE lost 4.1%. The STOXX 600, which had shown strong Q1 performance, has now been down 12% since Trump’s April 2 tariff announcement.
Concerns over disrupted supply chains and revised earnings outlooks have led investors to flee risky assets in favor of safe havens, further dampening the stock market globally.
India Seeks Relief for Marine Exports
Reacting to the U.S. tariff hike, Andhra Pradesh Chief Minister N Chandrababu Naidu urged the Centre to exempt fish and aquaculture exports from the new duties. The sector, vital to the state’s economy, faces a 27% import tax.
Marine exports to the U.S. stood at $2.55 billion in 2023-24, with shrimp alone comprising 92%. A steep duty could cripple the industry and affect thousands of livelihoods.
Trump’s Statement on Market Crash
President Trump commented on the global market turmoil by stating, “Sometimes you have to take medicine to fix something.” Declaring April 2 as “Liberation Day,” he defended the tariffs as a necessary move despite the chaos they unleashed across global markets.
Conclusion
The stock market remains highly volatile amid rising geopolitical tensions and trade conflicts. Investors should stay cautious as global developments unfold. While the last-hour rebound offers some hope, uncertainty is expected to persist in the coming weeks.
