Sensex, Nifty slip following RBI policy, Trump’s tariff remarks; pharma stocks under pressure

Nifty, Sensex extend losses to second session.

After a choppy intraday session, bears drove Dalal Street into the red during the afternoon trade on Wednesday, August 6, as the Reserve Bank of India's Monetary Policy Committee's decision failed to support the benchmark indices. Further, investors decided to trim exposure to the equity markets as U.S. President Trump's repeated tariff threats roiled sentiment.

At close, the Sensex was down 166.26 points or 0.21 percent at 80,543.99, and the Nifty was down 75.35 points or 0.31 percent at 24,574.20. About 1293 shares advanced, 2584 shares declined, and 153 shares unchanged.

""President Trump’s rhetoric and actions will continue to weigh on markets in the near-term. India’s response to the rhetoric and actions, so far, has been subdued and, of late, strong and measured. India is unlikely to concede to the unjustifiable and unreasonable demands of the US administration. This means there will be short-term pains for the economy in terms of lower exports," said VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

A key factor impacting the markets today was the Reserve Bank of India’s monetary policy committee decision to keep the repo rate unchanged at 5.5 percent, as the central bank continues to monitor US President Donald Trump’s fresh tariff threats. The RBI’s status quo policy is on expected lines.

Uncertainty emanating from U.S. tariffs and its impact on growth and trade/financial flows warrants close vigil on assessing the potential impact on overall macro-economic conditions. "We believe that with inflation remaining below target space for further rate easing will depend on evolving growth conditions," said Kaustubh Gupta, Co-Head Fixed Income, Aditya Birla Sun Life AMC.

Market sentiment remained weak across sectors in the afternoon session. Pharma led the losers with a 2 percent drop, followed by sharp declines in IT, Realty, and FMCG. Nifty Auto and Energy also slipped in trade.

On the flip side, PSU Bank was the only notable gainer, up over half a percent. Broader selling pressure continued to weigh on most sectors, along with the midcap and smallcap indices, that sank around one percent each.

Pharma stocks saw significant selling pressure in trade, with the Nifty Pharma index sinking over two percent. Indian pharmaceutical giants like Sun Pharma, Cipla, Dr Reddy’s Laboratories, and Lupin, among others, saw steep cuts of up to 2 percent after US President Donald Trump said he would sharply raise tariffs on imported medicines.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.