MUMBAI: Benchmark stock indices Sensex and Nifty ended lower on Wednesday, mirroring losses in global markets after the imposition of fresh US tariffs on China.
This decline came despite the Reserve Bank of India (RBI) cutting policy rates for the second consecutive time in a bid to support the economy amid growing global trade tensions.
The 30-share BSE Sensex fell 379.93 points or 0.51 per cent to close at 73,847.15. During the session, it dropped as much as 554.02 points or 0.74 per cent to touch an intraday low of 73,673.06.
The NSE Nifty declined 136.70 points or 0.61 per cent to settle at 22,399.15 after slipping 182.6 points or 0.81 per cent to a low of 22,353.25 during the day.
Tracking weak cues from Asian equities, Indian markets opened lower and remained subdued throughout the day. Sentiment was hit after the US announced a new round of tariffs, including a sharp 104 per cent duty on select Chinese imports.
Global financial markets are witnessing renewed selling pressure following the enactment of reciprocal tariffs. A trade war is escalating global risk, with a rise in US bond yields prompting a sell-off in the world’s safe treasury assets.
“In India, a cut in the repo rate, along with an accommodative policy stance, is taken as a constructive step. However, it has done little to uplift overall market sentiment, as the world is embracing recessionary risk,” said Vinod Nair, Head of Research at Geojit Financial Services.
Major losers
Among the Sensex stocks, State Bank of India (SBI) was the biggest loser, falling 3.43 per cent amid a broader decline in banking stocks.
Other major laggards included Tech Mahindra, Larsen & Toubro, Tata Steel, Sun Pharma, Infosys, HCL Tech, Axis Bank, Tata Consultancy Services and NTPC.
On the gaining side were Nestle, Hindustan Unilever, Titan, Power Grid, UltraTech Cement and ITC.
The BSE smallcap index slipped 1.08 per cent, while the midcap gauge dropped 0.73 per cent.
Sectorally, BSE Focused IT index declined 2.19 per cent, while IT (2.01 per cent), realty (2 per cent), teck (1.57 per cent), metal (1.44 per cent) and industrials (1.42 per cent) also posted losses. Auto, consumer durables and FMCG indices ended in the green.
Among Asian markets, Tokyo’s Nikkei 225 tumbled nearly 4 per cent, and South Korea’s Kospi also closed lower.
However, Shanghai’s SSE Composite and Hong Kong’s Hang Seng ended higher. European markets were trading sharply lower, while US markets closed significantly in the red on Tuesday.
Unanimous decision
The Reserve Bank of India (RBI) on Wednesday cut interest rates for the second time in a row and indicated the possibility of more easing going ahead. The Monetary Policy Committee (MPC) voted unanimously to cut the repo rate by 25 basis points to 6 per cent. This followed a similar cut in February, which was the first since May 2020.
RBI also changed its policy stance to “accommodative” from “neutral”, suggesting further support may be forthcoming.
Governor Sanjay Malhotra said the central bank is committed to aiding growth, especially in the face of external shocks such as the additional 26 per cent tariff the US has imposed on Indian exports from Wednesday.
In its updated outlook, RBI revised India’s GDP growth forecast to 6.5 per cent for 2025-26 from 6.7 per cent previously.
It also lowered its inflation projection to 4 per cent from 4.2 per cent, keeping it within the target band of 2-6 per cent.
Global oil benchmark Brent crude fell 4.23 per cent to $60.16 a barrel.
On Tuesday, following Monday’s steep losses, the BSE Sensex had rebounded sharply by 1,089.18 points or 1.49 per cent to end at 74,227.08, while the Nifty surged 374.25 points or 1.69 per cent to 22,535.85.
Indian stock markets will remain closed on Thursday on account of Mahavir Jayanti.
