Sensex, Nifty To Open On Sluggish Note As Investors Weigh Trump Tariffs

(RTTNews) - Indian shares look set to open lower on Thursday after U.S. President Donald Trump signed an executive order imposing an additional 25 percent tariff on India as a "penalty" in response to its continued purchase of Russian oil.

The Ministry of External Affairs has called the decision "extremely unfortunate" and said the government will continue to protect national interests. While the initial duty comes into effect today, the additional U.S. import tax will take effect in 21 days.

The tariffs, now totaling at 50 percent, threaten to disrupt India's access to its largest export market, where shipments totaled nearly $87 billion in 2024.

The overall impact on GDP is expected to be around 30-40 bps if these tariffs are sustained for a year.

In another significant development, Trump said he would impose a 100 percent levy on imports of chips and semiconductors, but will provide exemption for companies moving production back to the U.S.

Benchmark indexes Sensex and Nifty dipped around 0.2 percent and 0.3 percent, respectively on Wednesday as the RBI maintained the repo rate at 5.50 percent amid rising inflation risks and tariff worries.

The rupee recovered from record low level and closed 15 paise higher at 87.73 against the dollar.

Foreign investors offloaded shares worth Rs. 4,999 crore on a net basis on Wednesday, while domestic institutional investors bought shares to the tune of Rs 6,794 crore, as per provisional data from the NSE.

Asian markets were mostly higher this morning, while the dollar held losses and gold traded firm at $3,380 per ounce on growing expectations of a Federal Reserve rate cut next month.

Oil rebounded after a five-day drop on supply concerns as Trump warned of wider secondary sanctions for buying Russian oil.

U.S. stocks rose notably overnight as investors reacted to a slew of earnings, President Trump's tariff threat on pharma and chips, and a new $100 billion investment pledge from Apple to expand its U.S. operations.

The tech-heavy Nasdaq Composite climbed 1.2 percent, the S&P 500 added 0.7 percent and the Dow inched up 0.2 percent.

European stocks closed mostly higher on Wednesday, with earnings, tariffs and Fed rate cut hopes in focus.

The pan European STOXX 600 finished marginally lower, giving up early gains. The German DAX rose 0.3 percent, while France's CAC 40 and the U.K.'s FTSE 100 both edged up by 0.2 percent.