Sensex tanks 491 points over India-US trade tensions

Continuing losses for the fourth straight session, the BSE Sensex shed over 491 points and the NSE Nifty dived over 151 points on Monday after investors apprehended India’s retaliatory tariffs on US goods could lead to Indo-US trade war.

India has affected a hike in customs duties on as many as 28 US products, including almond, pulses and walnut, in response to higher tariffs imposed by Washington on Indian products like steel and aluminium.

“Indian markets continued to slide today as a delayed monsoon was a cause of worry for investors. Further adding to worries are concerns around an escalation of the trade war, and impacts for India, as well as US data that showed that the economy may not need a rate cut imminently,” Sunil Sharma, chief investment officer, Sanctum Wealth Management, said.

Analysts expect the market to be guided by factors like geopolitical developments, US-China trade negotiations and Fed interest rate decision amid lack of major domestic triggers.

Besides, fresh geopolitical tensions in the Middle East and anxieties over the progress of monsoon also discouraged market participants.

“Domestic market has been caught in a bearish grip as investors are increasingly turning cautious led by global trade war which has got darker. Additionally, geopolitical tensions in the Middle East triggered a sudden spurt in oil prices,” said Vinod Nair, Head of Research, Geojit Financial Services Ltd.