Indian equity benchmarks Sensex and Nifty nosedived over 1% in intraday trade on Friday, tracking weakness in global markets amid concerns over an economic slowdown and trade war sparked by U.S. President Donald Trump’s reciprocal tariffs. The correction in domestic market was led by persistent selling in IT stocks and fresh sell-off in pharmaceuticals and semiconductors space after President Trump commented about the upcoming tariffs on these sectors. The market correction wiped out ₹9.75 lakh of investors’ wealth as total market capitalisation of the BSE listed companies dropped to ₹404.40 lakh crore.

At 12:30 PM, the BSE Sensex was trading down by 1.01%, or 771 points, at 75,524, and the NSE Nifty50 was trailing by 288 points, or 1.24%, at 22,962 level. During the session so far, the 30-share Sensex lost as much as 859 points, or 1.12%, to hit a low of 75,436. Similarly, the broader Nifty tumbled 328 points, or 1.4%, to slip below crucial level of 23K to 22,921.

The broader markets were the worst hit, with the BSE midcap and smallcap indices falling up to 3%. As per the exchange data, 65 stocks hit their 52-week low levels today, while 194 shares were locked in their lower circuit limit. The market breadth, indicating the overall strength, was negative as 2,773 shares out of total traded stocks of 3,936 were in red zone.

Top gainers and losers

On the BSE Sensex pack, 24 out of 30 shares were trading in red zone, led by Tata Steel, Tata Motors, L&T, Reliance Industries, and IndusInd Bank, falling in the range of 4-6%.

On the other hand, HDFC Bank, Bajaj Finance, Axis Bank, Bharti Airtel, Nestle India, Bajaj Finserv, and ICICI Bank were among notable gainers, adding between 1-3%.

Pharma stocks crash on fresh tariff concerns

On the sectoral front, pharma space saw maximum selling amid reports that Donald Trump is considering imposing tariffs on pharmaceutical goods. On April 2, the Trump administration imposed 26% tariffs on all imports from India, but exempted pharmaceuticals from higher reciprocal duty. India imports pharma products worth nearly $800 million from the US, while exports to the country are worth $8.7 billion.

Reacting to the news, Nifty pharma index plunged over 6%, with all 20 constituents trading in the red. Aurobindo Pharma, Ipca Laboratories, Lupin, Laurus Labs and Biocon were notable losers, falling between 5-6%.

IT stocks extend fall

Continuing losing streak for the second straight session, largecap information technology (IT) stocks TCS, Infosys, Tech Mahindra, HCL Tech and Wipro lost another 2%. The sentiment was dented amid concerns that aggressive tariffs would severely hinder global economic growth, hurt corporate profits, spike inflation, and intensify existing trade conflict.

Midcap IT stocks such as Persistent Systems, Coforge, Mphasis and KPIT Tech were hammered again, falling between 4-7%, after losing up to 9% in the previous session.

Heightened uncertainty to drag market further down

According to analysts, markets are going through heightened uncertainty which is likely to last some time. A trade war has been triggered by Trump and retaliatory tariffs from China, EU and others are on the cards, which will only extend the period of uncertainty and confusion in the market, says V K Vijayakumar, Chief Investment Strategist, Geojit Financial.

“Investors can wait for the dust to settle down. For the short-term, it would be better to focus on domestic consumption driven themes and pharma in the externally-linked segments,” he added.

Australia-based brokerage firm Macquarie said in a note that U.S. reciprocal tariff of 26% on India is much worse than anticipated, which could be pretty negative. The U.S. effective tariffs, even after negotiations, are likely to rise to around 20-25% (versus 3% in '23). “This is a far worse outcome than our strategist was expecting in '25 preview (8%),” it said.

Technically, 23,350 and 77,000 is now the key level to watch for Nifty and Sensex, respectively, said Shrikant Chouhan, Head Equity Research, Kotak Securities, in a pre market report. “If the index moves above this level, the bounce could continue towards 23500-23600/77500-77800. Conversely, if it drops below 23150/75800, the selling pressure could increase, potentially leading the market to retest levels around 23000-22950/75500-75300,” he said.

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