Trump's Second Term Triggers Market Shock: Sensex Drops Over 1,200 Points, Nifty Closes at 23,024
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Synopsis
On January 21, 2023, the Indian stock markets faced a sharp decline as the Sensex dropped by 1,235 points and Nifty fell to 23,024, following US President Donald Trump's trade tariff threats against BRICS nations. Investors lost over Rs 7 lakh crore amid a weak sentiment and significant selling pressure from foreign investors.
Key Takeaways
- Sensex fell by 1,235 points
- Nifty closed at 23,024
- Investors lost over Rs 7 lakh crore
- Only two stocks in BSE Sensex posted gains
- FIIs sold equities worth Rs 48,023 crore
Mumbai, Jan 21 (NationPress) As the new US President Donald Trump commenced his second term by signing various executive orders and issuing warnings regarding potential trade tariffs on specific nations, including BRICS countries, both the Sensex and Nifty experienced a significant downturn on Tuesday.
Trump's comments aimed at BRICS nations, emphasizing his plan to enforce 100% tariffs on countries decreasing their dependence on the US dollar for international trade, led to pessimism in the Indian market, as noted by market analysts.
By the end of trading, the BSE Sensex plummeted by 1,235 points, or 1.6%, closing at 75,838, while the Nifty 50 fell by 320.1 points, or 1.37%, settling at 23,024.
This market decline resulted in a loss exceeding Rs 7 lakh crore for investors.
Within the BSE Sensex, only two stocks—UltraTech Cement and HCLTech—managed to remain in positive territory.
In contrast, the most significant drop was observed in Zomato, which fell nearly 11%, alongside ICICI Bank and Mahindra & Mahindra.
On the Nifty 50, eight stocks remained in the green, with Apollo Hospitals leading as the top gainer, up 2.76%, followed by UltraTech Cement, BPCL, Tata Consumer Products, and JSW Steel. The largest losses on the index were recorded by Trent, down 4.50%, along with ICICI Bank, NTPC, and Mahindra & Mahindra.
According to Vikram Kasat from PL Capital-Prabhudas Lilladher, Indian stock markets reversed their early gains and ended markedly lower during intraday trading.
“Major stocks like Zomato, Reliance Industries, and Kotak Bank significantly impacted the benchmark indices. Zomato was the primary contributor to the Sensex's decline, accounting for 170 points as its shares dropped over 11% following a 57% year-on-year decrease in net profit for the December quarter,” he stated.
Investor sentiment remained weak amid mediocre Q3 earnings and continued selling by foreign institutional investors (FIIs), who have offloaded equities worth Rs 48,023 crore (as of January 20).
In terms of sectors, FMCG was the only one to show a slight gain of 0.34%. All other sectors saw losses, with the Consumer Durables index being the worst performer, falling 3.59%, followed by the Realty index, down 3.04%.
Other notable declines included the Nifty Bank, down 1.33%, financial services, down 1.31%, auto down 1.04%, and media down 1.04%.
The broader markets were also negatively affected, with the Nifty Smallcap 100 down by 1.70% and the Nifty Midcap 100 losing 1.68%. Adding to investor worries, India's fear gauge, the India VIX index, surged by 5.92% to 17.39.
The rupee started strong at the opening, improving by 0.20 paise to reach 86.29 due to a weaker dollar overnight. The dollar weakened after US President Trump's inauguration ceremony, which introduced tariffs on imports from Mexico and Canada, creating short-term market uncertainty.
The US markets were closed on Monday in observance of the Martin Luther King Jr. Day national holiday.
