Equity benchmark indices Sensex and Nifty fell over 1% on Wednesday, 26 March, ending a seven-session winning streak, as investors booked profits amid uncertainty over US tariff policies.
Sensex, which opened on a strong note, briefly touched an intraday high of 78,167.87, gaining 150.68 points. However, selling pressure in select heavyweight stocks pulled it down by 806.45 points, or 1.03%, to a low of 77,210.74.
Similarly, the NSE Nifty slipped below the critical 23,500 level, hitting a low of 23,451.70 after initially rising 67.85 points to 23,736.50.
Key Factors Behind the Market Decline:
- US Tariff Uncertainty: Investor sentiment was weighed down by concerns over US trade policies. President Donald Trump has hinted at a major tariff announcement on 2 April, calling it a “Liberation Day” against nations he accuses of unfair trade practices. His remarks about “limited exceptions” have unsettled global markets, including India.
- Profit Booking: Following a week-long rally, investors locked in gains, causing a market pullback.
- Rupee Depreciation: The Indian rupee weakened by 6 paise to 85.78 against the US dollar in early trade, pressured by weak equities and a stronger dollar. Forex traders attributed the decline to liquidity constraints, concerns over reciprocal tariffs, and month-end dollar demand from importers. On Tuesday, the rupee had already ended its seven-session gaining streak, closing 11 paise lower at 85.72 per dollar.
- Rising Crude Oil Prices: Oil prices climbed as supply concerns mounted following President Trump’s threats of tariffs on countries importing oil and gas from Venezuela. As a major crude importer, India’s stock market remains sensitive to oil price fluctuations.
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