The Indian stock market and the rupee tumbled on Monday alongside their Asian peers as US President Donald Trump unleashed the global trade war with levies of 25% on Canada and Mexico and 10% on China.
The Indian stock market and the rupee tumbled on Monday alongside their Asian peers as US President Donald Trump unleashed the global trade war with levies of 25% on Canada and Mexico and 10% on China.
Indian benchmark indices — NSE Nifty 50 and 30-stock Sensex — fell as much as 1.03% and 0.94%, respectively, in Monday's early trade. The broader market fell in line with the benchmark indices. Metal, energy and oil and gas sectors led the declines.
The Rupee fell past the 87 mark during the opening to depreciate as much as 65 paise to 87.26 against the dollar. It recorded the worst opening since Feb. 2023.
Asian stocks plunged while dollar and crude oil prices rose as Trump unleashed the global trade war with levies of 25% on Canada and Mexico and 10% on China.
Japan's Nikkei was down 2.28% while South Korea's Kospi tumbled over 2.5% during the day. Future contracts in China and US hinted at a negative start for the stocks.
The Trump Trade Factor
US President Donalnd Trump signed tariff orders on Saturday, although Canada and Mexico announced their plans for retaliatory tariffs against the US. China also vowed retaliatory measures.
Canada will place a 25% counter-tariff on $107 billion worth of US-made products, while Mexico will kick off a response plan that includes retaliatory tariffs against the levies.
The Euro and Mexico's peso fell while the Canadian dollar plunged to its weakest since 2003. This comes as trades rushed to buy the dollar amid its gaining strength. The dollar index — which tracks the greenback's performance against a basket of 10 leading global currencies — was 1.31% up at 109.78.
Eye On Flows
Meanwhile, foreign portfolio investors stayed net sellers of Indian equities for the 22nd straight session on Saturday as they sold stocks worth approximately Rs 1,327 crore.
The losses in the stock market offset the positive sentiment set by the Finance Minister Nirmala Sitharaman in the 2025 Union Budget with an income tax cut for salaried employees to boost demand.
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