The BSE Sensex saw a decline of approximately 0.5%, closing at 73,847.2 on Wednesday. This movement reversed the previous day's 1.5% gain and was largely influenced by a broad downturn in global markets spurred by the tariff measures implemented by U.S. President Trump. The latest round of U.S. reciprocal tariffs, which included a significant 104% duty on Chinese imports, came into force earlier in the day. This development has raised investor concerns about its potential consequences on inflation, interest rates, and global economic growth.
In an accompanying move, the Reserve Bank of India decided once again to lower its key policy rates and adjusted its monetary policy stance to be more accommodative, aligning with market expectations. Reserve Bank Governor Sanjay Malhotra noted that amidst the ongoing global tariff conflict, his primary concern is the impact on economic growth rather than inflation, prompting a downward revision of the GDP forecast for FY2025-26 from 6.7% to 6.5%. Inflation projections were also adjusted from 4.2% to 4%. In the corporate realm, sectors such as finance and pharmaceuticals faced notable effects as they responded to the newly imposed tariffs and anticipated regulatory changes.
