By Bharath Rajeswaran
(Reuters) -Indian shares fell on Monday, tracking weakness in their regional peers after U.S. President Donald Trump imposed sweeping tariffs on Canada, Mexico and China, spurring concerns of a broader trade war.
The Nifty 50 was down 0.93% at 23,265.1 points, as of 10:09 a.m. IST, while the BSE Sensex shed 0.81% to 76,874.54.
Asian stock markets slumped as Trump’s tariffs triggered fears of a hit to global growth, with the MSCI Asia ex-Japan index dropping about 3%. [MKTS/GLOB]
All 13 major domestic equity sectors declined, while the domestically focussed smallcaps and midcaps lost 1.9% and 1.3% respectively.
Meanwhile, the Indian rupee weakened past 87 per U.S. dollar for the first time, as other regional currencies slumped.
After Trump followed through on his threat to hit the three countries with tariffs on imports, there is shock among investors, said Vikram Kasat, head of advisory of PL Capital of Prabhudas Lilladher.
The near-term market trajectory will depend on “how investors react to something that is almost universally damaging for economic growth,” Kasat said.
State-owned companies lost 4%, taking its two-session loss to 7% and erasing all the gains made in the pre-budget rally last week.
Larsen & Toubro lost 4%, extending its drop after losing 3.4% on Saturday. Analysts said the muted capex growth in the budget is a sentiment negative for the sector bellwether.
Other capital goods companies such as Hitachi Energy and Thermax lost 8% and 7%, after Motilal Oswal downgraded the stocks citing weakness in the industrial sector due to the modest capex growth.
Oil marketing companies Bharat Petroleum Corp and Indian Oil Corp lost 5% and 3%, while Hindustan Petroleum Corp lost 7%.
“The budgeted liquefied petroleum gas (LPG) subsidy implies OMCs will bear 69% of fiscal year 2025 under-recoveries, which will cap their earnings upside,” Jefferies said.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sherry Jacob-Phillips and Varun H K)
