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Indian Markets Plunge ₹19 Lakh Crore Amid Global Trade War Fears

For investors in the Indian stock market, it is a "Black Monday" as US President Donald Trump imposed tariffs on more than 180 nations worldwide, sparking an "economic trade war" that sent Dalal Street into a tailspin. On April 7, Indian stock markets faced a steep selloff, losing over ₹19 lakh crore in market cap, as investor sentiment was shaken by global tariff tensions sparked by the US. Major Asian indices also declined. Investors lost ₹19 lakh crore due to this carnage, as the market capitalization of all companies listed on the BSE fell from ₹403.34 lakh crore to ₹383.81 lakh crore.

Mid- & Small-cap Indices Shattered
Even more severe cutbacks were made to the broader markets, as the BSE Smallcap index fell 10.5% to a low of 41,013.68, and the BSE Midcap index plummeted more than 8% to 37,203.21. With an advance-decline ratio of 1:10, it was evident how weak the Indian stock market was—for every stock that moved in the green, at least ten were in the red.
The India VIX, a measure of anxiety, also increased, rising 54.98% to 21.32. None of the indices were spared sectorally either. Fears that a US recession will slow industrial demand caused all 13 of the NSE's major sectors to trade lower, with Nifty Metal leading the decline.
Additionally, Nifty IT stocks, heavily reliant on US revenue, also took a hit amid concerns of slowing global tech demand. FMCG and pharmaceutical defenses also failed, although the loss was comparatively small.
Global markets are not left behind
As Asian markets saw their greatest one-day decline in 16 years, the effects of Trump's trade policies were felt worldwide. According to Bloomberg, TSMC, Tencent, and Sony dragged down the MSCI Asia Pacific Index, which dropped as much as 7.9%—the most since October 2008. The most significant decline since the global financial crisis occurred in Hong Kong's Hang Seng Index fell as high as 10.7%. All markets were firmly in the red.
The US stock markets have also been affected by these tariffs. Instead, they have become one of the most significant victims of Trump's trade policy.
Bill Ackman, a billionaire investor, claims that Trump risks undermining trust in the American economy and alienating investors if he starts an "economic nuclear war."
In a social media post, Ackman stated, "We are in the process of destroying confidence in our country as a trading partner, as a place to do business, and as a market to invest capital by placing massive and disproportionate tariffs on both our friends and our enemies and thereby launching a global economic war against the entire world at once."
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