Indian shares fell sharply on Thursday as trade uncertainties and heightened geopolitical risks overshadowed hopes for more Federal Reserve rate cuts this year.
There is considerable ambiguity over the U.S.-China trade deal in the wake of conflicting claims about tariff rates and lack of confirmation from Beijing.
Adding to tariff uncertainty, Trump said he would notify trading partners within the next one to two weeks about the new unilateral tariff rates, with the choice to accept or reject them.
Elsewhere, in a sign of growing regional tensions, Iran said it will strike U.S. bases in the Middle East if nuclear talks fail and conflict arises with Washington.
There is growing speculation that Israeli forces may strike Iran’s nuclear facilities, adding to investor nervousness.
On the positive side, softer U.S. inflation released on Wednesday boosted the odds of Fed rate cuts.
Money markets now price in about two Fed reductions by the end of 2025, with traders boosting bets on a September cut to around 75 percent.
The benchmark 30-share BSE Sensex tumbled 823.16 points, or 1.00 percent, to 81,691.98, with selling seen across segments.
The broader NSE Nifty index closed down 253.20 points, or 1.01 percent, at 24,888.20 on concerns that a spike in Brent crude to $70 on heightened security risks may lead to unfavorable macroeconomic effects in oil-importing countries like India.
The broader market followed suit, with the BSE mid-cap and small-cap indexes ending down 1.5 percent and 1.4 percent, respectively.
The market breadth was weak on the BSE, with 2,726 shares falling while 1,283 shares rose and 142 shares closed unchanged.
Among the prominent decliners, Hindustan Unilever, Mahindra & Mahindra, Larsen & Toubro, Tata Steel, Power Grid Corp, Eternal, Titan Company and Tata Motors fell 2-3 percent.
Sensex Slumps Over 800 Points Amid Risk-off Mood; Nifty Dips Below 24,900
2025-06-12 10:26:01
