The Indian benchmark indices began the trading in red on Tuesday, after a draft notice published by the Department of Homeland Security (DHS) revealed that US President Donald Trump plans to go ahead with 50 per cent tariffs on Indian goods from Wednesday.
The Nifty 50 fell 167.90 points, or 0.67 per cent, at 24,799, while the Sensex declined 546 points, or 0.67 per cent at 81,089.
Trump had earlier said the US would raise tariffs on Indian goods to 50 per cent from 25 per cent, citing the country's purchases of Russian crude oil.
Among sectoral indices, the Nifty Metal index slipped 1.04 per cent. The Nifty Pharma index declined 1.57 per cent, the Nifty PSU Bank index was down 0.84 per cent and the Nifty Private Bank index fell 0.96 per cent.
In the Nifty pack, top gainers included Bajaj Auto, Hero Motocorp, HUL, and Infosys. Among the top losers were Tata Steel, Dr Reddys Labs, ICICI Bank, and Tata Motors.
"Inability to close above the 25,000/25,033 zone yesterday suggests that buyers are not keen on chasing prices higher. This leaves room for dips. The possibility of an upswing could diminish if Nifty slips below 24,870, but it would require a direct fall below 24,740 to initiate downside plays," said Anand James, Chief Market Strategist, Geojit Investments Limited.
Since the principal reason for the market’s resilience is liquidity and liquidity flows are likely to be sustained, the market is unlikely to correct significantly, and the elevated valuations may continue. Investors may avoid unjustifiably expensive small caps and focus on large caps which are reasonably fairly valued, added Dr VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.
The US markets were mostly in the red zone. The Dow Jones Industrial Average fell 0.77 per cent, while the Nasdaq was down by 0.22 per cent and the S&P 500 dropped 0.43 per cent.
The Asian markets were mostly in the red zone. China's Shanghai index rose 0.07 per cent, while Japan's Nikkei slipped 1.06 per cent. The Hong Kong's Hang Seng Index dipped 0.13 per cent and South Korea's Kospi declined 1 per cent.
On Monday, foreign institutional investors (FIIs) remained net sellers for the second consecutive day as they sold equities worth Rs 2,466 crore, while domestic institutional investors (DIIs) purchased equities worth Rs 3,176 crore.
