The Indian stock markets experienced a sharp decline on Tuesday, driven by global jitters surrounding US President Donald Trump’s second term, marked by his signing of executive orders and warnings of steep trade tariffs. The Sensex fell by 1,235 points (1.6%) to close at 75,838, while the Nifty 50 slipped 320.1 points (1.37%) to end at 23,024.
Market experts attributed the slide to Trump’s comments targeting BRICS nations and signaling a 100% tariff on countries reducing their dependency on the US dollar for international trade. These statements led to a surge in negative investor sentiment in the Indian markets.
The market downturn erased over ₹7 lakh crore of investor wealth. On the BSE Sensex, UltraTech Cement and HCLTech were the only stocks to end in positive territory, while Zomato faced the steepest losses, plunging nearly 11%. Other heavyweights like ICICI Bank and Mahindra & Mahindra also recorded substantial declines.
On the Nifty 50 index, eight stocks managed to stay in the green, with Apollo Hospitals leading gains at 2.76%, followed by UltraTech Cement, BPCL, Tata Consumer Products, and JSW Steel. However, major losses came from Trent, which fell by 4.5%, along with ICICI Bank, NTPC, and Mahindra & Mahindra.
Market analyst Vikram Kasat of PL Capital noted that large-cap stocks like Zomato, Reliance Industries, and Kotak Bank dragged the indices down significantly. Zomato’s sharp decline came after the company reported a 57% year-on-year drop in its December quarter net profit, contributing 170 points to the Sensex’s fall.
Weak Q3 earnings and persistent selling by foreign institutional investors (FIIs), who offloaded equities worth ₹48,023 crore as of January 20, added to the bearish sentiment.
Among sectors, FMCG eked out a marginal gain of 0.34%, while all others recorded losses. The Consumer Durables sector led the declines, falling 3.59%, followed by the Realty sector, down 3.04%. Financial services, auto, media, and banking sectors also ended in the red.
Broader markets mirrored the trend, with the Nifty Smallcap 100 and Nifty Midcap 100 indices dropping 1.7% and 1.68%, respectively. The India VIX index, a measure of market volatility, surged 5.92% to 17.39, reflecting heightened investor anxiety.
The rupee showed resilience in early trade, strengthening by 0.20 paise to 86.29 against the dollar, buoyed by overnight weakness in the greenback. This softness was partly triggered by Trump’s inaugural actions, including imposing tariffs on imports from Mexico and Canada, which fueled global market uncertainty.
US markets were closed on Monday for the Martin Luther King Jr. Day holiday.
