Broader markets trade flat after Trump unveils new tariffs

Broader markets trade flat after Trump unveils new tariffs

Broader markets in India were trading flat on April 3, hours after US President Donald Trump unveiled new tariffs. This is seemingly indicative of most of the tariff impact already being absorbed with all the phases of announcements on reciprocal tariffs. BSE Midcap is currently trading 0.51% lower while Smallcap is 0.19% lower. The contrast between defensive pharma bets and pressure on IT and manufacturing-heavy stocks underscores the sectoral divergence at play.

There's selective buying in niche stocks with gains in FMCG, pharmaceuticals, and specialty chemicals indicate a defensive tilt, while significant sell-offs in engineering, IT, and infrastructure stocks suggest profit-booking amid global volatility.

As of 10:00 am, Style Baazar led the pack of smallcap gainers with a sharp gain of 11.06%, trading at Rs 346.95. Shiva Cement shares surged 9.82% to Rs 33.90 apiece, followed by Parag Milk Foods, which rose 7.61% to Rs 181.70. Other notable gainers included NACL Industries (+6.79%), Jubilant Pharmova (+6.29%), Suven Pharmaceuticals (+5.56%), Star Cement (+5.47%), and Suyog Telematics (+5%).

On the downside, Pokarna was the top loser, plunging 13.18% to Rs 802.05. Cigniti Technologies and Goldiam International dropped around 5.96% and 5.86%, respectively, while AstraZeneca Pharma declined 4.74%. Other laggards included Gensol Engineering (-4.99%), Navin Fluorine (-4.60%), and EPL Ltd. (-4.35%).

As of 10 am, the midcap index saw Gland Pharma as the lead gainer, advancing 4.87% to Rs 1,609.90. IPCA Laboratories also posted notable gains of 4.48%, while Lupin rose 4.39%. Among financials, AU Small Finance Bank gained 3.03% to Rs 555.05, and GMR Airports was up 3.01%. On the losing side, Persistent Systems led the pack, plunging 8.26% to 4,876.00. Coforge also faced selling pressure, down 8.04%, followed by KPIT Technologies declining 4.37%.

Domestic benchmarks Nifty 50 and Sensex opened sharply lower on April 3, as sentiment took a hit from higher-than-expected reciprocal tariffs announced by U.S. President Donald Trump. However, the indices pared some of the morning losses as investors absorbed the tariff news.

Akshat Garg, AVP, Research at Choice Wealth believes says that while the initial reaction to the reciprocal tariffs announced by U.S. President Donald Trump has weighed on sentiment, the broader Indian market is likely to remain resilient in the midterm. He also pointed out that the tariff rates imposed by the U.S. are around 10-20 percent

“India was relatively prepared for the tariffs, as data regarding exposure to affected sectors like pharma, auto, iron, and aluminum was already considered,” he said. According to Garg, while some sector-specific downturn is inevitable, the overall market impact will be limited. “You’d see a downfall, but it'll settle down in the midterm,” he added.

Even if the US and India do not reach a compromise, Garg suggested that India may look to diversify exports to reduce dependence on the American market.