Mumbai: The global financial markets witnessed a sharp decline on Friday following the United States' announcement of additional tariffs on Chinese products. The ripple effect of this decision led to a significant drop in the Indian stock market, with the benchmark indices Sensex and Nifty plummeting by 1,414 and 420 points, respectively.
Market analysts attributed the steep decline to continued selling by foreign institutional investors (FIIs) and the weakening of the Indian rupee against the US dollar, which negatively impacted investor sentiment.
The 30-share BSE Sensex fell by 1,414.33 points or 1.90 percent, closing at 73,198.10. During intraday trading, the index had dropped as much as 1,471.16 points to hit 73,141.27. Meanwhile, the NSE Nifty also recorded losses for the eighth consecutive session, slipping 420.35 points or 1.86 percent to close at 22,124.70.
Since reaching its all-time high of 85,978.25 on September 27 last year, the BSE Sensex has shed 12,780.15 points, translating to a 14.86 percent decline. Similarly, the NSE Nifty has lost 4,152.65 points or 15.80 percent since its record high of 26,277.35 on the same date.
Among the Sensex components, Tech Mahindra led the losers with a drop of over 6 percent, while IndusInd Bank fell by more than 5 percent. Other major laggards included Mahindra & Mahindra, Bharti Airtel, Infosys, Tata Motors, Titan, Tata Consultancy Services, Nestle, and Maruti. Notably, HDFC Bank was the sole gainer in the Sensex pack.
Asian markets mirrored the global sentiment, with South Korea's Kospi, Japan's Nikkei, China's Shanghai Composite, and Hong Kong's Hang Seng all closing in the red. European markets also traded lower, following the sharp declines in US markets on Thursday.
Vinod Nair, Head of Research at Geojit Financial Services, stated, "The domestic market witnessed sharp corrections amidst a bearish global trend. The decline was primarily driven by concerns over the US imposing a 25 percent tariff on imports from Canada and Mexico, along with an additional 10 percent duty on Chinese goods."
Nair added that the market sentiment further deteriorated due to fears that the US might extend tariffs to imports from the European Union as well.
Data from the stock exchanges indicated that FIIs sold equities worth ₹556.56 crore on Thursday. Brent crude, the global oil benchmark, fell by 0.69 percent to settle at $73.53 per barrel.
On Thursday, the BSE Sensex had posted a modest gain of 10.31 points to close at 74,612.43, while the Nifty had edged down by 2.50 points to 22,545.05.
