Sensex, Nifty to open lower as Trump's latest China tariff shakes global markets; RBI policy in focus

Indian share market is poised to open lower on Wednesday as Asian markets and Wall Street witnessed sharp volatility amid concerns that U.S. President Donald Trump’s latest threat of levying additional 50% tariffs on China faded optimism about potential trade negotiations. The GIFT Nifty index dropped 135 points, or 0.6%, to 22,465, indicating a gap-down opening for the domestic benchmarks BSE Sensex and NSE Nifty.

Rate sensitive stocks such as auto, banking, and real estate will be in focus ahead of the Reserve Bank of India's monetary policy decision today. The RBI's MPC is widely expected to deliver a 25 bps cut in the repo rate for the second consecutive time in the policy, which will be announced at 10:00 AM today.

On Tuesday, Indian equity market rebounded over 1.5% in a relief rally, led by gains in banks, capital goods, IT, FMCG, oil&gas, and realty stocks. Reversing three-session losing streak, the Sensex closed above 74,000 mark and the Nifty reclaimed the 22,500 level in a broad-based rally. In the broader markets, BSE Midcap and Smallcap rallied 1.87% and 2.18%, respectively. The market capitalisation of the BSE listed companies rose by ₹8 lakh crore to ₹3.97 lakh crore. In the BSE Sensex pack, barring PowerGrid, all the Sensex constituents closed in green zone. The top gainers were Titan, Bajaj Finance, Larsen & Toubro, State Bank of India, and Axis Bank, rising up to 3%.

Trump’s unprecedented 104% tariff on China spooks U.S. stocks  

In the overnight trade, Wall Street closed lower in a highly volatile session on Tuesday after President Trump threatened to impose "additional 50% tariffs" on China, effective from today. The Trump administration has given China 24 hours to "withdraw" the retaliatory 34% tariff it imposed on U.S. goods, failing which Chinese goods would be slapped with 104% import duty.

Amid persistent uncertainty about the president’s tariff policies and escalated trade war, all three major U.S. indices closed in red on Tuesday. The Dow Jones Industrial Average declined 0.84%, the S&P 500 lost 1.57%, and the Nasdaq Composite ended 2.15% lower.

Earlier in the day, U.S. stocks opened sharply higher amid on hopes of trade negotiations, with the Dow industrials rising as much as 1,461 points in early trade. In a similar trend, the S&P 500 and the tech-heavy Nasdaq rose up to 4%, registering their record intraday gains. However, sentiment was dented as optimism over trade talks faded after Trump's fresh tariff threats spooked investors.

Asian markets resume fall after Trump tariffs

Stock markets across Asia-Pacific resumed sell-off on Wednesday, after a day’s pause, as global markets continue to reel from U.S. President Trump's aggressive reciprocal tariffs. The White House latest move to slap a steep 104% duty on China induced fresh negativity in the market as investors fear that it would escalate global trade war further.

Japan’s Nikkei 225 was the worst performer in the region, falling over 2.5% in early trade, while Hong Kong’s Hang Seng dropped over 1.3%. South Korea’s Kospi was down 0.5% and China’s Shanghai Composite was trading 0.3% lower in early trade. Among others, Taiwan’s Weighted stock index plunged nearly 2%, while Singapore’s Straits Times lost 1.3%. Meanwhile, Australia’s ASX 200 index closed 1.1% lower.

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