The BSE benchmark indices ended over 1% lower in the Monday trade owing to the global trade war. Sensex lost 505 points to close at 37,586 whereas Nifty50 broke down 137 points to settle at 11,378.
Sun Pharmaceutical Industries gained the most (+2.7%), followed by Wipro, HCL Technologies. Whereas, Reliance Industries, Axis Bank, State Bank of India, Titan and Indiabulls Housing were notable names in red.
Factors affecting the market’s performance:
- Global Uncertainty
A weak trend in the opening for Indian markets was because of flat close on wall street and muted trend in other Asian markets. Reportedly, many Asian markets fell owing to buzz about the new tariff on Chinese imports by Trump government.
- Concerns about the trade war
Media reported suggested that U.S. President Donald Trump may announce new tariffs on Chinese import. This induced pressure in global trade as China may deny any such proposal by Washington.
- Inadequate government measures
The government announced an array of measure to contain widening current account deficit and defending the rupee. These measures included withholding taxes from masala bonds, relaxation for foreign portfolio investors, and limiting non-essential imports. Some of the experts believe that these government measures are not adequate to defend the rupee.
- Volatile Indian currency
The Indian rupee continued to suffer depreciation to 72.64 per dollar on Monday (- 79 paise) after making a dramatic recovery in recent two days. The currency is now trading between 72.48 per dollar.