Nifty 50 Falls 0.6% and Sensex Drops 0.61% as U.S. Tariffs on Indian Goods Take Effect

Market Update at 10:15 AM: India’s equity benchmarks opened lower on Tuesday as investor sentiment weakened ahead of the additional 25 per cent U.S. tariffs on Indian goods, which are set to take effect on Wednesday.

The Nifty 50 index fell 0.6 per cent to 24,818.8 points, while the BSE Sensex declined 0.61 per cent to 81,135.1 as of 9:22 a.m. IST. Market breadth remained weak, with fifteen of the sixteen major sectors trading lower. The broader Mid-Cap and Small-Cap indices also slipped about 1 per cent each, reflecting broad-based selling pressure.

The move comes after U.S. President Donald Trump announced a 25 per cent punitive tariff on Indian goods, citing New Delhi’s purchase of Russian oil during the Ukraine conflict. This tariff is in addition to the earlier 25 per cent duties already imposed. According to a notification issued on Monday, the U.S. Department of Homeland Security has outlined the procedure to implement these additional duties on Indian exports.

Pre-Market Update at 7:30 AM: Indian equity benchmarks, the Sensex and Nifty 50, are likely to open lower on Tuesday, August 26, tracking weak global market cues ahead of the US tariffs deadline on Indian goods. As of 7:07 AM, the GIFT Nifty was trading near 24,928, down 65 points from its previous close.

Asian markets traded lower, with Japan’s Nikkei 225 down over 1 per cent. On Wall Street, US indices ended in the red on Monday as traders weighed the outlook for interest rates and awaited Nvidia’s Quarterly Results. The Dow Jones Industrial Average declined 0.77 per cent to 45,282.47, the S&P 500 fell 0.43 per cent to 6,439.32, and the Nasdaq slipped 0.22 per cent to 21,449.29.

Foreign Institutional Investors (FIIs) were net sellers on Monday, August 25, offloading equities worth Rs 2,466.24 crore. On the other hand, Domestic Institutional Investors (DIIs) turned buyers and purchased shares worth Rs 3,176.69 crore.

Equities began the week on a strong note, with the Nifty 50 closing at 24,967.75, up 0.39 per cent, while the Bank Nifty ended almost unchanged at 55,139.30. IT stocks led sectoral gains, supported by Realty and Consumer Durables. Mid-cap and small-cap indices finished flat to slightly higher, continuing investor interest across segments.

US President Donald Trump dismissed Federal Reserve Governor Lisa Cook, citing allegations of mortgage fraud. On trade, Trump threatened tariffs of up to 200 per cent on China unless it supplies magnets to the US. He also warned that countries enforcing digital taxes on American firms could face tariffs on their exports.

In economic data, US new single-family home sales slipped 0.6 per cent in July to an annualised 6,52,000 units, though June’s numbers were revised higher.

The US dollar index slipped 0.3 per cent to 98.187 in early Asian trade following Trump’s announcement regarding the Fed official. Gold prices fell 0.4 per cent to USD 3,353.14 per ounce on possible profit-taking. Brent crude oil futures declined to USD 68.4 per barrel, while WTI crude futures dropped to USD 64.4 per barrel, retreating after recent gains.

For today, Titagrah and RBL Bank remain on the F&O ban list.

Disclaimer: The article is for informational purposes only and not investment advice.