Nifty 50 settles below 23,000, Sensex crashes 900 points amid intensifying sell-off; Rs 11 lakh crore wiped off by bears

ONGC, Hindalco and Cipla were among the top losers on the Nifty 50 index.

Benchmark indices Sensex and Nifty 50 extended their losing streak to a second session on April 4, falling over a percent each, as a risk-off sentiment took over global markets amid fears of a trade war on the back of U.S. President Donald Trump's reciprocal tariffs.

At close, the Sensex was down 930.67 points or 1.22 percent at 75,364.69, and the Nifty was down 345.65 points or 1.49 percent at 22,904.45. About 1081 shares advanced, 2721 shares declined, and 131 shares unchanged.

Over Rs 11 lakh crore was wiped out in wealth, as investors fled their equity holdings. On the Nifty 50 index, ONGC, Hindalco and Cipla were among the top losers, crashing over six percent respectively. The sell-off intensified over the course of the session, as investors digested the broad-based impact of the sweeping tariffs.

All the sectoral indices traded with sharp cuts, with the auto, pharma, IT and metals gauges losing the most. The broader markets bled sharply, with the Nifty Midcap 100 and Nifty Smallcap 100 crashing up to thee percent in the afternoon session.

"The higher-than-expected reciprocal tariffs and related increased uncertainty with respect to global growth and inflation and earnings of companies should logically lead to a more cautious investment environment," said Kotak Institutional Equities. "The high valuations of the Indian market and of most sectors and stocks would suggest that the market has largely ignored the potential risks."

"The recent implementation of higher-than-anticipated U.S. tariffs has had a significant impact on global markets, triggering a bearish trend as investors assess the broader implications. The likelihood of retaliatory measures against the U.S. has further heightened uncertainty. U.S. bond yields and oil prices are trending downward, reflecting concerns over potential economic slowdown and increased recessionary risks," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

"Domestically, while the direct impact of these tariffs is relatively moderate compared to other major economies, it remains more substantial than initially projected. As Q4 approaches, a sequential improvement in corporate performance is anticipated. However, prevailing weak market sentiment suggests that the phase of consolidation may persist in the near term," he added.

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Economists at J.P. Morgan believe there is a 60 percent chance of the U.S. economy being pushed into a recession, as a result of Trump's tariffs. “The effect of this tax hike is likely to be magnified — through retaliation, a slide in US business sentiment, and supply chain disruptions,” PMorgan Chief Economist Bruce Kasman said in the note titled, “There will be blood.” This would lead to shockwaves being felt across the globe.

The metals index crashed sharply, as fears of China, Vietnam, and South Korea dumping their steel production at low costs spiked. This would impact the sales and margin growth for domestic players. Further, fears of an extended trade war between global giants have dampened sentiment.

Pharmaceutical stocks have seen a sharp sell-off in trade on April 4, after U.S. President Donald Trump announced that his administration is looking at possible tariffs on pharmaceuticals. However, international brokerage CLSA allayed concerns, stating that the risk of high tariffs on pharma products is low.

Shares on the IT index also saw continued selling, including leading names like TCS and Infosys, as well as others midcap names, as US President Trump's reciprocal tariffs sparked worries over slowing client spends and US consumption.

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