Tariff Impact: Sensex tumbles 1,555 pts, Nifty down 2% in two sessions; what’s next?

Domestic equity benchmarks Sensex and Nifty ended lower for the second consecutive session on Thursday, weighed down by losses in heavyweight IT and banking stocks, as fresh US tariffs dampened investor sentiment. Export-oriented counters came under heavy selling pressure after Washington imposed an additional 25 per cent duty, effective from Wednesday.

At close, the BSE Sensex was down 705.97 points, or 0.87 per cent, at 80,080.57, taking its two-day decline to 1,555 points. The NSE Nifty50 fell 211.15 points, or 0.85 per cent, to settle at 24,500.90, extending its two-day fall to nearly 2 per cent. 

HCL Technologies emerged as top loser on Sensex, with its shares falling 2.82 per cent to Rs 1,450.10. TCS declined 1.94 per cent, followed by Power Grid Corporation of India (down 1.93 per cent), Infosys (down 1.89 per cent), Hindustan Unilever (down 1.49 per cent) and HDFC Bank (down 1.24 per cent).

Five stocks namely HDFC Bank, ICICI Bank, Infosys, TCS and Bharti Airtel, contributed heavily to the Sensex’s decline. 

Among the sectoral indices, the BSE IT slipped 1.68 per cent to end at 34,764.96, while the BSE Bankex index was down 0.96 per cent, closing at 60,113.41.

Meanwhile, at last check, gold October futures rose 0.16 per cent to Rs 1,01,700, while silver September futures gained 0.66 per cent to Rs 1,16,866.

Ajit Mishra, SVP, Research at Religare Broking Ltd, said the markets extended their decline on monthly expiry day, losing nearly a percent and continuing the corrective trend. “After a weak opening, the Nifty staged a swift rebound in the initial hours, but sustained pressure from heavyweight stocks across key sectors dragged the index to fresh lows as the session progressed,” he said.

“It eventually settled near the day’s low at 24,500.9. Sectoral performance was broadly weak, with IT, realty, and banking stocks leading the decline. The broader indices also mirrored this trend, with mid- and small-cap segments slipping close to a percent each,” Mishra said.

Mishra, on the technical front, said the 50-pack Nifty has breached its medium-term support at the 100-day EMA around 24,600. “The next support is seen in the 24,250–24,350 zone, which aligns with the previous swing low and the long-term 200-day EMA. On the upside, the 24,650–24,800 region, earlier a support zone, is now likely to act as resistance. Traders are advised to align positions with the prevailing trend and exercise heightened caution in stock selection," he said.

Overall, out of the 4,258 active stocks traded on the BSE, 1,467 ended with gains, while 2,635 settled lower and 156 remained unchanged. As many as 102 stocks scaled their 52-week highs during the session. A total of 141 others hit their 52-week lows. The session also saw 203 stocks locked at their respective upper circuits and 215 others at lower circuits.

Vinod Nair, Head of Research, Geojit Investments Limited, said domestic equities ended lower as pessimism took hold following the implementation of tariffs on Indian goods, dampening investor sentiments.

“While the cotton import duty exemption briefly lifted hopes of policy support to counter tariff impacts, triggering a short-lived intraday recovery, investor mood remained fragile, with large caps declining and mid and small caps underperforming amid risk-off sentiment,” Nair said.

“Most sectors, including Auto, IT, FMCG, and Metals, traded in the red as investors turned to profit booking from recent gains, while Consumer Durables outperformed, likely supported by GST rationalisation and expectations of festive demand," Nair added.