Mumbai (Maharashtra) [India], August 26 : The Indian stock market on Tuesday witnessed a sharp sell-off after the Trump administration issued a notification to impose an additional 25 per cent tariff on Indian imports. The secondary tariffs will come into effect from August 27 and take the total tariff on Indian goods to 50 per cent.
Stock markets traded under pressure today and slipped below crucial support levels, derailing the recent recovery momentum.
At the end of the trading session, Nifty 50 at the National Stock Exchange (NSE) slipped 255.70 points, or 1.02 percent, to 24,712.05, while the BSE Sensex was down 849.37 points, or 1.04 percent, to 80,786.54.
"The announcement triggered a wave of risk-off sentiment across domestic markets, leading to broad-based weakness," said Sudeep Shah, Head of Technical Research and Derivatives at SBI Securities.
The Bank Nifty index has been exhibiting notable underperformance compared to the frontline indices over the past few sessions, reflecting growing pressure in the banking space. On Tuesday, the index extended its decline and breached its prior swing low, reinforcing the bearish undertone.
The Bank Nifty saw swing low of 55000, confirming further downside levels towards the 53500/52700 mark.
Except for the FMCG index, all the indices ended negative, with the maximum loser being the small-cap index, down by more than 2%.
"The broader market pain is likely to continue in the near term," said Kunal Shah, research analyst, Mirae Asset ShareKhan, observing the markets.
Praveen Dwarakanath, Vice President of Hedged.in, highlighted that secondary tariffs by the US coming into effect is a major cause of the fall of the market.
"The (secondary) tariff on India by the US is to be implemented on the August 27. Any change in tariff can push the markets on the upside," he added.
Ajay Bagga, banking and market expert, toldthat investors remain on edge with the secondary tariffs due to be implemented by the US.
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