Market Wrap: Sensex ends 296 points lower, Nifty below 24,800 after brushing off Trump tariff salvo

Time of India

31-07-2025

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Indian equities ended lower on Thursday but trimmed steeper early losses, as investors interpreted the U.S.'s proposed 25% tariff and unspecified penalties, set to take effect August 1, as a negotiating ploy rather than a definitive policy shift.The BSE Sensex shed 296.28 points, or 0.36%, to close at 81,185.58, while the NSE Nifty slipped 86.70 points, or 0.35%, to settle at 24,768.35. Both indexes had fallen nearly 0.9% earlier in the session.The benchmarks slid nearly 1% in early trade after U.S. President Donald Trump announced 25% tariffs on India, effective August 1, along with an unspecified penalty. He added that negotiations with India were ongoing.For the month, both the Sensex and Nifty dropped around 3%, with broader markets underperforming amid sustained foreign outflows and weak earnings from IT firms and major financials.Textile stocks were among the hardest hit by the tariff announcement, with Welspun Living, Vardhman Textiles, KPR Mills, and Gokaldas Exports falling between 3.2% and 5.1%.Adani Enterprises declined 4% after reporting a drop in first-quarter profit, hurt by subdued coal demand.The consumer goods sector rose 1.4%, the day's top gainer, led by Hindustan Unilever. Shares of the FMCG major climbed 3.4% as a revival in rural demand and a refreshed product portfolio lifted quarterly earnings.Mid-cap and small-cap stocks each lost about 1%.Following a turbulent start driven by fresh tariff threats, the Indian market started on a pessimistic note, said Vinod Nair, Head of Research, Geojit Investments, adding that the domestic market, however, attempted "a strong recovery but by the end of the day it closed with marginal losses, on a monthly expiry day.""Investors gravitated toward domestically oriented, non-discretionary players, especially FMCG, which offered attractive valuations, demand outlook and relative insulation from tariff risks. In contrast, oil & gas stocks were the worst hit due to US warnings over Indian energy imports. Overall, the market reflected a cautious yet selective approach. Market continues to hold high hopes for a more favorable tariff outcome in the near-term," said Nair.As the new series begins, the market is likely to consolidate, but global developments and corporate earnings will continue to drive volatility, said Ajit Mishra, SVP, Research, Religare Broking, adding that "we maintain our cautious stance and recommend a stock-specific approach, given the mixed trends across sectors. Traders should also avoid averaging down on loss-making positions."World equities were mixed Thursday as investors weighed a slew of economic signals, including central bank policy decisions, inflation readings, and the prospect of last-minute trade negotiations ahead of U.S. President Donald Trump's Aug. 1 tariff deadline.European stocks were supported by earnings, with the pan-European Stoxx 600 holding steady as of 1025 GMT. The index is on pace to end the month up 1.6%, buoyed by easing trade concerns, stronger-than-expected economic data from the U.S. and Europe, and broadly positive corporate results.Bank shares led gains in Europe, rising more than 1.5% after upbeat earnings from Standard Chartered and France's Société Générale.MSCI's broadest index of global shares was flat, pressured by declines in Chinese markets after official PMI data pointed to weaker-than-expected factory activity in July. The CSI 300 fell 1.8%, its steepest drop since April 7, while Hong Kong's benchmark shed 1.6%.Oil prices slipped Thursday as traders assessed geopolitical risks tied to U.S. President Donald Trump's push for a swift end to the war in Ukraine via additional tariffs, while a surprise increase in U.S. crude inventories added pressure.Brent crude futures for September delivery, set to expire later in the day, fell 60 cents, or 0.8%, to $72.64 a barrel by 0955 GMT. U.S. West Texas Intermediate crude for September dropped 58 cents to $69.42.The Indian rupee posted its steepest monthly decline in nearly three years on Thursday, pressured by concerns over potential U.S. tariffs and sustained foreign portfolio outflows.The rupee weakened to 87.74 per dollar, its lowest level since February, after U.S. President Donald Trump threatened a 25% levy on Indian exports along with an unspecified penalty starting Aug. 1. The currency settled at 87.5950, down 0.2% on the day. For the month, the rupee lost 2%, marking its worst performance since September 2022.The dollar index held steady at 99.8 after gaining nearly 1% in the previous session.