Global Uncertainties Impact Indian Market Amid Looming Tariff Concerns

The Indian stock market opened negatively on Friday due to global uncertainties and impending tariffs set for April 2. Despite initial setbacks, mixed market breadth, and rising tension in the Middle East, optimism remains if FPI inflows continue and domestic capital gets utilized.

On Friday, the Indian stock market entered negative territory following a record-setting closure the day before. This downturn was fueled by mounting global uncertainties and the imminent implementation of broad-based reciprocal tariffs slated for April 2. The BSE Sensex decreased by 69.91 points to 76,278.16, while the NSE Nifty fell by 22.40 points to start at 23,168.25. Despite the initial declines, market performance showed mixed results, with 31 Nifty companies reporting gains and 19 declining.

Healthcare and finance sectors, including companies like Bajaj Finance and Nestle India, emerged as top gainers. Conversely, the IT sector saw significant drops, with majors like Infosys and TCS experiencing notable losses. Banking and marketing expert Ajay Bagga noted that worldwide central banks, including those from Indonesia, Brazil, the Bank of England, and the U.S. Federal Reserve, have failed to alleviate growing concerns over economic risks through their recent outlooks.

Bagga voiced concerns over the looming April 2 tariffs, describing the situation as flying blind into a volatile and cautious market environment. Geopolitical tensions have also been a point of concern, with escalations like the Israel-Hamas conflict and France advising citizens to leave Iran adding to the uncertainty. The IT sector faced further strain due to Accenture's earnings report, which raised alarms about future growth prospects for Indian IT companies largely tied to U.S. government contracts.

Despite these challenges, strong Foreign Portfolio Investor inflows were recorded in two of the last three trading sessions, presenting a glimmer of hope. Bagga highlighted that sustained FPI inflows and activation of domestic capital could catalyze a rebound towards new record highs for the Indian market. However, the uncertainty surrounding April 2 continues to cast a shadow, making predictions challenging amid evolving global risks. Bagga concluded with a cautiously optimistic stance, wary of unexpected developments in what could evolve into an unfavorable trade war scenario.

(With inputs from agencies.)