Stock market today : Nifty50 and BSE Sensex , the Indian equity benchmark indices, were volatile in trade on Tuesday. While Nifty50 went below 24,550, BSE Sensex sank over 700 points. At 1:17 PM, Nifty50 was trading at 24,517.95, down 199 points or 0.80%. BSE Sensex was at 80,644.56, down 729 points or 0.90%.
The key Indian stock market indices traded in negative territory on Thursday, with financial, IT and interest rate-sensitive sectors leading the decline. The downward movement occurred as investors awaited the RBI's monetary policy announcement, whilst global trade conflicts and US fiscal uncertainties weighed on sentiment.
Why is the stock market falling today? Top reasonsThe following six factors contributed to the day's market decline:
1. Global Trade Tensions Escalate
Market confidence deteriorated following US President Donald Trump's announcement to increase tariffs on imported steel and aluminium to 50%, effective June 4, 2025. This decision has created uncertainty for Indian metal exporters, including Tata Steel, Hindalco, and JSW Steel.
India's exports of these metals to the US exceeded $4.5 billion in FY25. Whilst immediate effects might be limited, the tariff increase contributes to global uncertainty.
"President Trump's 50% tariffs on steel and aluminium is a clear message that the tariff and trade scenario will continue to be uncertain and turbulent," said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Additionally, investors are monitoring developments regarding a possible discussion between Trump and Chinese President Xi Jinping, as trade tensions persist between the world's largest economies.
2. Weak Global Economic Indicators
Manufacturing in the United States contracted for the third month in succession. Similarly, Chinese manufacturing activity registered its first decline in eight months, suggesting that American tariffs are impacting international trade patterns.
The impact was evident in financial markets, with both Nasdaq and S&P 500 futures declining by more than 0.3% during early trading sessions.
3. Markets Cautious Before RBI Meeting
Interest rate-sensitive industries, including banking, financial services, automobiles and consumer goods experienced selling pressure whilst awaiting the RBI's policy announcement on Friday. Despite widespread expectations of a 25-basis-point reduction in rates, traders reduced positions due to uncertainty regarding the central bank's outlook and future policy direction.
The Nifty Bank and Financial Services indices declined approximately 0.8%, whilst Automobile and FMCG sectors decreased by up to 0.5%.
4. US Debt and Bond Yields Situation
Financial markets are responding to the US Senate's upcoming deliberations on a fresh $3.8 trillion fiscal package. This development coincides with the US federal debt exceeding $36.2 trillion.
The prospect of additional government borrowing has driven long-term US bond yields towards the significant 5% threshold, creating downward pressure on global equity markets.
5. Fluctuations in Oil Prices
Crude oil prices continue to fluctuate amidst international political tensions and constrained supply conditions. Brent crude remained at $64.75 per barrel, whilst WTI stood at $62.72.
Both contracts experienced approximately 3% gains in the previous trading session following OPEC+ decision to maintain July output increases at 411,000 barrels per day — a figure below market expectations and consistent with increases observed over the previous two months.
The conservative stance adopted by OPEC+ and ongoing uncertainties regarding Iran's nuclear agreement have created additional supply uncertainties. Elevated crude prices traditionally affect India's trade position and contribute to inflation, negatively influencing investor confidence.
6. Market Outlook on US Interest Rates
Fed Governor Christopher Waller's recent comments indicated potential rate reductions this year, subject to economic indicators. Whilst market participants calculate a 75% probability of a September rate adjustment, the Federal Reserve has not provided definitive guidance, creating additional market ambiguity.
(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
The key Indian stock market indices traded in negative territory on Thursday, with financial, IT and interest rate-sensitive sectors leading the decline. The downward movement occurred as investors awaited the RBI's monetary policy announcement, whilst global trade conflicts and US fiscal uncertainties weighed on sentiment.
Why is the stock market falling today? Top reasonsThe following six factors contributed to the day's market decline:
1. Global Trade Tensions Escalate
Market confidence deteriorated following US President Donald Trump's announcement to increase tariffs on imported steel and aluminium to 50%, effective June 4, 2025. This decision has created uncertainty for Indian metal exporters, including Tata Steel, Hindalco, and JSW Steel.
India's exports of these metals to the US exceeded $4.5 billion in FY25. Whilst immediate effects might be limited, the tariff increase contributes to global uncertainty.
"President Trump's 50% tariffs on steel and aluminium is a clear message that the tariff and trade scenario will continue to be uncertain and turbulent," said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Additionally, investors are monitoring developments regarding a possible discussion between Trump and Chinese President Xi Jinping, as trade tensions persist between the world's largest economies.
2. Weak Global Economic Indicators
Manufacturing in the United States contracted for the third month in succession. Similarly, Chinese manufacturing activity registered its first decline in eight months, suggesting that American tariffs are impacting international trade patterns.
The impact was evident in financial markets, with both Nasdaq and S&P 500 futures declining by more than 0.3% during early trading sessions.
3. Markets Cautious Before RBI Meeting
Interest rate-sensitive industries, including banking, financial services, automobiles and consumer goods experienced selling pressure whilst awaiting the RBI's policy announcement on Friday. Despite widespread expectations of a 25-basis-point reduction in rates, traders reduced positions due to uncertainty regarding the central bank's outlook and future policy direction.
The Nifty Bank and Financial Services indices declined approximately 0.8%, whilst Automobile and FMCG sectors decreased by up to 0.5%.
4. US Debt and Bond Yields Situation
Financial markets are responding to the US Senate's upcoming deliberations on a fresh $3.8 trillion fiscal package. This development coincides with the US federal debt exceeding $36.2 trillion.
The prospect of additional government borrowing has driven long-term US bond yields towards the significant 5% threshold, creating downward pressure on global equity markets.
5. Fluctuations in Oil Prices
Crude oil prices continue to fluctuate amidst international political tensions and constrained supply conditions. Brent crude remained at $64.75 per barrel, whilst WTI stood at $62.72.
Both contracts experienced approximately 3% gains in the previous trading session following OPEC+ decision to maintain July output increases at 411,000 barrels per day — a figure below market expectations and consistent with increases observed over the previous two months.
The conservative stance adopted by OPEC+ and ongoing uncertainties regarding Iran's nuclear agreement have created additional supply uncertainties. Elevated crude prices traditionally affect India's trade position and contribute to inflation, negatively influencing investor confidence.
6. Market Outlook on US Interest Rates
Fed Governor Christopher Waller's recent comments indicated potential rate reductions this year, subject to economic indicators. Whilst market participants calculate a 75% probability of a September rate adjustment, the Federal Reserve has not provided definitive guidance, creating additional market ambiguity.
(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
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