The markets have taken a turn for the worse in afternoon trade. The Sensex has plunged nearly 800 points and the Nifty is down over 200 points, well below the 24,700 level. The broader markets too are under pressure. The BSE Midcap Index is down 1.8% and the BSE Small Cap Index is down over 2%.
Market Veteran Deepak Jasani highlighted that the “Indian markets have been under pressure for the last 1 week in sync with global sentiment which has weakened over the last 2-3 days. The latest pharma tariff salvo from Donald Trump has further weighed on the sentiment. Uncertainty amongst investors is increasing as economic and corporate perfomance over next two quarters may get impacted.”
Three reasons why markets are falling today
There are three main factors that are impacting sentiment in today’s trade.
1. Pharma stocks under pressure
In the latest on tariffs, US President Donald Trump has unveiled a 100% tariff on branded medicines. Though the tariff on branded drugs and a significant portion of India’s exports to US is generics, it is seen as a sentimental negative move. The market is now worried if further tariffs would be extended tothe generics as well.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments, explained, “President Trump’s tantrums with tariffs are resuming with new tariff imposts on patented and branded drugs. India being an exporter of generic drugs is unlikely to be impacted by this. But perhaps the president’s next target can be the generic drugs. This decision may have a sentimental impact on pharmaceutical stocks.”
He added that “Trump is now moving from country-specific tariffs to product-specific tariffs. Higher tariffs on trucks, upholstered furniture, etc., indicate that the Trump administration’s weaponisation of tariffs may continue till US inflation spikes, forcing a rethink of this policy.”
2. Accenture results drag Indian IT stocks
Indian IT stocks extended their losing streak for the sixth session today, after Accenture’s quarterly earnings hinted at a sluggish recovery in global tech spending. The Nifty IT index slipped 2% with all 10 constituents in the red, while LTIMindtree, Wipro, and Tech Mahindra were among the top losers, each falling around 2%. So far in 2025, the index has already dropped 21%, in contrast to a 5% gain in the benchmark Nifty 50.
Accenture posted a 1.5% revenue growth in its fiscal fourth quarter.
3. FII selling continues
The other continuing worry for the markets is the continued selloff by the FIIs. So far in 2025, FIIs have sold equity exceeding Rs 1,80,443 crores. Coming on top of the selling of equity for 1,21,210 crores in 2024,. This in itself highlights how massive the selling has been so far.
According to Dr. VK Vijayakumar, “The sustained FII selling may keep the market under pressure. Investors can utilise dips to slowly accumulate high quality stocks, particularly those that are driven by domestic consumption.”