Pharma stocks sharply tumbled on June 17 after US President Donald Trump said that "pharma tariffs are coming very soon". Consequently, the Nifty Pharma index plunged nearly 2 percent to close at 21,623 and emerge as the top sectoral loser.
The index has now recorded losses in three out of the past four sessions.
US President Donald Trump told reporters on board the Air Force One on June 17 that tariffs on pharmaceutical imports are coming "very soon". This can potentially impact Indian pharma players who derive a major portion of their revenue from US exports.
Granules India and Lupin shares were the top losers on the index, dropping nearly 4 percent each. Natco Pharma, Laurus Labs and Aurobindo Pharma followed, plunging over 3 percent each.
Dr Reddy's Laboratories, Divi's Labs and Zydus Life plunged over 2 percent each, while Sun Pharma, Cipla and Glenmark Pharma shares plunged over 1.5 percent each. Biocon and Alkem Labs shares were down over 1 percent each.
Notably, pharma stocks have seen significant volatility in recent days, since US President Donald Trump had unveiled his first batch of tariffs in early April. "The pharma [tariffs] are going to be starting to come in at, I think, a level that you haven't really seen before," Trump had said on April 4. This had sent the pharma stocks to a tailspin.
The stocks rose later on the delay in tariff imposition and possibility of a trade deal between India and US. Volatility soon crept in when Trump announced in May that the pharma tariffs will be levied in two weeks.
Notably, Trump had set July 9 as the deadline for nations before the significant tariffs take effect. While pharma sector was out of the category facing general reciprocal tariffs, no further communication from the US administration had so far supported the stocks. However, the latest announcement will likely put significant pressure on the stocks.
Trump had exited the G7 summit in Canada a day early, leaving investors considering a possible ceasefire between Israel and Iran. However, Trump later denied the speculations, slamming French President Emmanuel Macron for such ceasefire claims. Trump clarified that he was planning "something much bigger than that". The latest statement on pharma tariffs comes after that.
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