Weekly wrap: Stock market ends flat as RBI rate cut, Trump’s tariff pause neutralise losses

The Indian share market experienced an overall volatile downward trend this truncated week, but supportive domestic factors and temporary relief from U.S. tariffs helped in recovering most of the weekly losses. An unexpected announcement by U.S. President Donald Trump to pause reciprocal tariffs provided significant relief to global equity markets, which were grappling with high uncertainty and recession concerns arising from potential trade wars. The sentiment was also lifted by the Reserve Bank of India's (RBI) decision to ease interest rates.

Driven by strong rally on Friday after the U.S. decision to defer tariffs, domestic benchmark indices BSE Sensex and NSE Nifty ended the week with marginal losses. The 30-share Sensex settled the week with a loss of 207 points, or 0.27%, at 75,157 level, and the Nifty50 closed 76 points, 0.33%, lower at 22,829 mark. The overall market capitalisation of BSE listed companies stood at ₹401.67 lakh crore at the end of trade on April 11.

The market sentiment, which was initially cautious due to global trade uncertainties and the U.S. tariffs, turned positive on Friday following the temporary suspension of the additional tariffs. On April 10, President Trump announced a complete three-month pause on all the “reciprocal” tariffs, with the exception of China. The U.S. had earlier announced a 10% baseline tariff on almost all imports effective April 5, 2025, and a higher 26% tariff specifically on Indian goods, effective April 9, 2025.

Here’s how Indian equity market performed last week:

Indian equities started the week (April 7) on a highly bearish note amid uncertainty surrounding global tariff actions, with the Sensex and Nifty slumping over 3%. The market rout wiped out nearly ₹18 lakh crore of investors’ wealth amid fears of a global trade war and rising recession concerns in the U.S. During the session, the benchmark indices crashed over 5% - logging their worst single-day losses since Covid-19 pandemic outbreak in March 2020 - in sync with global peers, with Asian stocks falling as much as 15%.

However, the market staged a smart recovery on April 8 (Tuesday), rebounding 1.7% in relief rally amid value buying by investors at attractive levels, tracking firm cues from global peers.

On April 9 (Wednesday), the domestic bourses slipped 0.6% amid persistent uncertainties about global trade scenario. The market also factored in another 25 basis points cut in the repo rate by the RBI's Monetary Policy Committee (MPC) for the second consecutive time following the decline in inflation. The central bank has changed its stance from “neutral” to “accommodating” to ensure economic stability in a challenging time, paving the way for further rate cuts in the upcoming meetings.

On April 10 (Thursday), Indian stock markets, including BSE and NSE, were closed for Mahavir Jayanti. Meanwhile, IT bellwether Tata Consultancy Services (TCS), the country’s second valued listed company, kicked-off fourth quarter earnings season by releasing its financial performance for March quarter. The country’s largest software company saw its consolidated net profit falling nearly 2% year-on-year to ₹12,224 crore in Q4 FY25, while its revenue rose 5.3% YoY to ₹64,479 crore. The earnings were below street expectations amid the ongoing macroeconomic headwinds for the IT sector.

On April 11 (Friday), the market resumed the trade on positive note, rising as much as 2% during the session as the U.S. decision to defer tariffs boosted sentiment and lifted fears of a global slowdown. The Sensex surged 1,310 points, 1.77%, to reclaim 75K mark, and the Nifty50 climbed 429 points, 1.92%, to close above 22,800 level.

What should investors do now?

The D-Street experts believe that the current market texture is extremely volatile and uncertain; therefore, level-based trading would be the ideal strategy for positional traders.

“In the near future, the 50-day and 20-day SMA (Simple Moving Average) or 23,000/75,800 would act as crucial resistance zones for Nifty and Sensex. On the downside, retracement support is positioned at 22,500/74,200,” said Amol Athawale, VP-Technical Research, Kotak Securities.

Ajit Mishra – SVP, Research, Religare Broking, said the recovery in the market, supported by a continued decline in the volatility index, is a positive sign, though such sharp moves remain challenging to trade. “On the index front, a decisive close above 22,900 for Nifty could pave the way for a retest of the key moving average zone near 23,400. On the downside, immediate support lies at 22,300.”

“Until more stability is seen, we recommend maintaining a hedged approach. Participants should stay focused on global developments and corporate earnings for further direction,” added Mishra.

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