Tue Jan 21 13:57:12 UTC 2025: ## Indian Stock Market Plunges to Seven-Month Low Amidst Trump’s Tariff Announcement

**Mumbai, India** – India’s stock market experienced a sharp downturn on Tuesday, with the Sensex plummeting to a seven-month low following US President Donald Trump’s announcement of potential tariffs on neighboring countries. The benchmark BSE Sensex closed 1,235 points (1.60%) lower at 75,838, after falling as low as 75,641.87 during the day’s volatile trading. The Nifty 50 index on the NSE also suffered a significant decline, closing at 23,024.65, down 320.10 points (1.37%). This marks the Nifty’s closest approach to the 23,000 level since June 2024.

The market-wide selloff wiped out approximately ₹7 lakh crore (approximately $85 billion USD) from the total market capitalization of BSE-listed companies. The decline is largely attributed to concerns over the economic implications of Trump’s potential trade tariffs, particularly the hinted 25% tariffs on Canada and Mexico. Experts point to a lack of clarity regarding Trump’s economic policies and the potential for gradual implementation of tariff increases as contributing factors to the market’s anxiety.

The sell-off was widespread, impacting large-cap, mid-cap, and small-cap stocks. The Nifty Midcap 100 index fell 2.31%, and the Nifty Smallcap 100 index dropped 2.28%. Sectors hardest hit included auto, IT, PSU, pharma, realty, energy, media, and infrastructure. Of the 30 Sensex stocks, 28 closed in the red, with notable losers including Zomato, NTPC, ICICI Bank, SBI, Reliance Industries, Mahindra & Mahindra, Bajaj Finance, Tech Mahindra, and Axis Bank. Only UltraTech Cement and HCL Tech managed gains.

Analysts attribute the negative market sentiment to weak Q3 earnings and significant foreign institutional investor (FII) selling (₹48,023 crore since January 20th). The uncertainty surrounding Trump’s trade policies further exacerbated the situation, leading to increased volatility and investor apprehension. The weakening rupee against the dollar also contributed to the FII outflow.

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