The Indian stock market indices Sensex and Nifty plunged in trade on Monday, after US President Donald Trump's tweet on raising trade tariffs spooked investors.
The Indian stock market indices Sensex and Nifty plunged in trade on Monday, after US President Donald Trump upped the ante in the ongoing trade war with China, spooking the entire Asian markets. Notably, Donald Trump tweeted that he would raise tariffs on $200 billion of Chinese goods from 10% to 25% from Friday. The Sensex ended 363 points down to 38,600.34, while the Nifty closed below the 11,600-mark. Asian shares tanked too– the Shanghai Composite Index slipped 5% by midday Monday, while Hong Kong’s Hang Seng Index slumped more than 3% lower.
The Japanese markets were closed on Monday on account of Children’s’ Day in the country. “Today’s fall is by and large due to global factors. Apart from that, the share market had a good run up in last couple of weeks. With corporate earnings trickling in, its just a reason for the markets to correct,” Krish Subramanyam, co-head, equity advisory, at Altamount Capital told Reuters.
While there were speculations that China is considering to cancel the high-level trade talks with the US scheduled for later this week, the country’s top trade envoy has clarified that they will be going to the US for trade talks. “Chinese team is preparing to travel to the United States for trade talks,” Chinese Foreign Ministry Spokesman Geng Shuang told reporters.
The clarification came in after Donld Trump’s tweet sent Asian markets and oil prices on a downward spiral, as investors were concerned about a trade war between the world’s dominant economies. If carried out, Donald Trump’s latest move is set to increase duties on more than 5,000 products made by Chinese producers, ranging from chemicals to textiles and consumer goods. The US president had originally imposed a 10 per cent tariff on these goods in September that was due to rise in January, but postponed this as negotiations advanced.
Among the various index heavyweights, Yes Bank shares tumbled more than 5% to hit the day’s low at Rs 166.60 on BSE after ratings agency ICRA downgraded bank’s long-term ratings. Shares of Tata Steel slumped nearly 4% to Rs 527.75 to register their worst day in nearly three months on reports that Brussels is likely to block its merger with ThyssenKrupp AG. Titan shares closed more than 5.5% lower on BSE to Rs 1,082 ahead of the firm’s Q4 results scheduled to be reported later this week.