Fri Apr 04 04:20:00 UTC 2025: ## Indian Tech Stocks Plunge on US Tariff Fears

**MUMBAI, April 5** – Indian technology stocks suffered a second day of heavy losses on Friday, April 4th, plummeting to a nine-month low amid growing concerns over a potential US recession triggered by President Trump’s escalating tariff war. The Nifty IT index dropped 3.3%, extending Thursday’s 4.21% fall, and marking a 9% loss for the week and a staggering 27% decline from its December 2024 high.

Leading Indian tech companies like Infosys, TCS, and HCL Tech all saw their shares fall over 2%, with Coforge experiencing the sharpest decline. The sell-off is fueled by fears that President Trump’s newly imposed tariffs on 180 countries, including India, will negatively impact the US economy. Analysts warn that these tariffs could lead to higher inflation and reduced consumer spending, potentially pushing the US into a recession.

This fear is particularly acute for Indian tech companies, which derive a significant portion (60-80%) of their revenue from the US market. The escalating trade tensions have also dashed hopes for US Federal Reserve rate cuts, with Morgan Stanley now predicting none in 2025. JPMorgan has raised its recession probability forecast to 60%, estimating that the tariffs effectively increase the US average tax rate by roughly 22 points. UBS echoes these concerns, predicting a US slowdown and assigning a 30% probability to a recessionary scenario if tariffs persist. Goldman Sachs also increased its US recession probability to 30% within the next 12 months.

Analysts are consequently lowering their growth estimates for Indian tech companies, anticipating weak Q4FY25 earnings. Morgan Stanley has advised against buying Indian IT stocks, citing macroeconomic headwinds and potential revenue growth delays. The firm expects fiscal year 2026 revenue to be underwhelming for major IT companies.

**Disclaimer:** The views expressed in this article reflect analysts’ opinions and do not constitute investment advice. Consult with certified financial experts before making any investment decisions.

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