Stock markets fall due to Trump’s tariffs

Both the NSE Nifty 50 and the BSE Sensex fell this morning as investor sentiment weakened following the imposition of a minimum 25 per cent US tariff on India.The other reason is that July 31 is the last expiry date for futures trading.Capital market expert Arun Kejriwal says, “This sharp decline is due to the impact of Trump’s imposition of 25 per cent reciprocal tariffs on India across various product categories and unannounced penalties on energy and arms imports from Russia.” This has increased uncertainty in the market.While the 25 per cent tariff imposed by the US on Indian exports certainly disrupts critical sectors and poses immediate challenges to the Indian economy, it is unlikely that it will significantly alter the country’s long-term growth trajectory. India’s growth story is supported by solid fundamentals such as a growing domestic market, vibrant entrepreneurial spirit and growing international partnerships.

Additionally, increased tariffs eventually increase the costs of consumers and businesses in the US, making these measures unviable over time. Both countries have a shared interest in maintaining beneficial trade relations, which increases the likelihood of tariff policies being revised or eased in the future. “As market conditions and consumer demands evolve, both sides may tend to negotiate and cooperate, thereby mitigating any lasting impact of temporary tariff increases,” says Rajesh Palviya, senior vice-president (research), Axis Securities.