Mumbai: Indian equities experienced a significant sell-off on Friday, influenced by a global retreat from riskier assets following Wall Street’s steep decline — its worst since 2020. The downturn was a reaction to U.S. President Donald Trump’s reciprocal tariff measures, which have raised concerns about a potential global economic slowdown.
The NSE Nifty index decreased by 1.5%, losing 345.65 points to close at 22,904.45, while the BSE Sensex fell by 1.2%, shedding 930.67 points to settle at 75,364.69. This significant drop eradicated ₹10 lakh crore from the market’s value on Friday.
U.S. markets saw a decline of 4-5% by 23:50 IST on Friday after China put forth retaliatory tariffs and imposed export restrictions on essential materials. Mahesh Patil, the Chief Investment Officer at Aditya Birla Sun Life AMC, stated that the extensive sell-off in the U.S. has incited a global risk-off sentiment. He also noted that the likelihood of a U.S. recession is contributing to global growth worries, but bilateral discussions might alleviate some tariffs in the upcoming weeks.
On Friday, U.S. Treasury yields fell below 4% for the first time since October, driven by recession fears, prompting a shift towards safer assets. The uncertainty surrounding the US-China trade conflict led to a substantial drop in oil prices, with Brent crude futures falling 6.8% to $65.35 per barrel. Aashish Somaiyaa, CEO of WhiteOak Capital AMC, remarked that the sharp decline in U.S. markets, along with downgrades in economic forecasts and the anticipated retaliatory measures from China and the European Union, is unsettling global markets.
Asian markets showed mixed reactions, with China, Hong Kong, Taiwan, and Indonesia closed on Friday. Japan fell by nearly 2.8%, Thailand saw a decrease of 3.6%, Vietnam declined by 1.8%, and South Korea was down by 0.9%.
Despite being relatively better positioned than its Asian counterparts such as China, Taiwan, and Bangladesh, Indian markets experienced a downturn due to escalating tariff conflicts marked by retaliatory actions from several countries, according to Patil. The decline in the Sensex and Nifty was moderated by resilient performances from blue-chip lenders like Bajaj Finance, HDFC Bank, and ICICI Bank, which saw increases between 0.5% and 1.5%. The Bank Nifty index recorded a modest dip of 0.2%. However, broader market indices showed no such support, with the Nifty Mid-cap 150 index and the Small-cap 250 index dropping by 2.9% and 3.3%, respectively.
Out of 4,076 shares traded on the BSE, 1,029 advanced while 2,923 declined. The Nifty Metal Index plummeted 6.6% on Friday, and the Pharma and IT sectors each fell by approximately 4%. Additionally, the Nifty Realty Index decreased by 3.6%, with the oil & gas, healthcare, consumer durables, and automotive sectors slipping between 2-4%.
Foreign portfolio investors (FPIs) sold shares worth a net ₹3,484 crore on Friday, while their domestic counterparts sold shares valued at ₹1,720 crore. In April, overseas investors have sold equities amounting to over ₹14,500 crore.