Nifty, Sensex See Sharpest 1-Day Fall in 10 Months; RBI Rate Cut Likely & More
- Share.Market
- 9 min read
- 07 Apr 2025
07 April 2025
Highlights
Indian markets plunged sharply, with the Nifty 50 sinking 3.24% and the Sensex falling 2.95%. Both benchmarks posted their worst single-day decline since June 4, 2024. The sell-off was driven by fears over slowing global growth and escalating US-China trade tensions, following tariff announcements by the US and retaliatory steps by China. Sector-wise, Nifty Metal led the fall, crashing 6.75%. Among stocks, Emami stood out as the top gainer, up 4.38%, while SIEMENS nosedived 42.93%, marking the day’s biggest loss.
Headline Indices
Sectors at a Glance
*Prices shown may have delay up-to 15 minutes
What moved the market?
*Prices shown may have delay up-to 15 minutes
Put Call Ratio of Nifty 50 (expiry: 09th Apr) is 0.6
What’s Moving India’s Economy?
- The Reserve Bank has started its regular policy review, and experts expect it may cut interest rates by 0.25% to help the economy. With inflation cooling and global challenges like U.S. tariffs growing, more rate cuts – up to 1% in total – are likely this year. Industry leaders believe this could boost growth and make borrowing easier for everyone.
- India’s exports to the US – especially marine products, gold, and electronics – may drop by $5.76 billion due to higher American tariffs. While sectors like textiles and pharma could see slight gains, overall trade is set to take a hit.
- Despite global disruptions from new U.S. tariffs, India could still hit its 2025-26 growth goal if oil prices stay under $70/barrel. Economists remain cautious, warning of risks to sectors like diamonds and textiles. The government is reviewing potential support for exporters.
- The government has raised excise duty on petrol and diesel by ₹2 per litre. Don’t worry – it won’t affect consumers right now, thanks to recent price cuts. Meanwhile, oil company stocks dipped as global crude prices hit their lowest since April 2021.
- India, Sri Lanka, and the UAE have joined hands to turn Sri Lanka’s Trincomalee region into a key energy hub. The plan includes building solar plants, energy pipelines, and upgrading old oil storage facilities. This project aims to boost energy access, create jobs, and support Sri Lanka’s economic recovery.
- Rural India drove FMCG growth in Q4, with strong demand for food products. FMCG companies saw urban demand dip due to food inflation, while quick commerce sales surged. Despite lower margins, firms remain upbeat for FY26, expecting gains from easing inflation, a good monsoon, and strong international sales.
What’s Shaping Global Markets?
- Asian stock markets experienced a sharp sell-off today, driven by escalating fears of a global trade war following U.S. President Donald Trump’s sweeping tariffs on over 180 countries. Japan’s Nikkei plunged over 8%, triggering circuit breakers, while South Korea’s Kospi fell 4.3% and Australia’s ASX 200 dropped 6%, entering correction territory.
- Futures for major U.S. indices point to continued declines after Friday’s sell-off, where the Dow Jones fell 5.5%, the S&P 500 dropped 5.97%, and the Nasdaq declined by 5.8%. These losses have officially pushed Nasdaq into bear market territory.
- U.S. crude oil prices have dropped below $60 per barrel, marking their lowest levels since April 2021
- China’s retaliatory tariffs (34% on U.S. goods) have escalated the trade war, causing widespread market uncertainty. Trump described his tariffs as “medicine,” signaling no immediate resolution to the tensions
US Tariffs Shook the Markets; What Should You Do?
News of rising global trade tensions — from tariff hikes to diplomatic stand-offs – is spooking investors and sending shockwaves through indices.
This is the moment to take a step back and assess the situation.
So, what happened?
As of April 2025, the U.S. has imposed a 26% tariff specifically on Indian goods. Key sectors hit include gems and jewellery, IT services, and agriculture.
Markets responded immediately. The Nifty 50 and Sensex closed around 3% lower. The India VIX jumped 65%, reflecting a spike in investor fear. All sectoral indices closed in the red, with export-driven stocks taking the worst hit. Even gold, typically seen as a safe haven in times of uncertainty, slipped, adding to the unease.
Fears are building that this trade war could slow down the U.S. economy or even tip it into recession, increasing the likelihood of a Fed rate cut in the months ahead.
Volatility is normal. Panic is optional.
What’s happening isn’t new. The global economy goes through phases of conflict, competition, and realignment. Trade tensions between countries — whether it’s the US and China, or more recently, new tariff regimes involving India — tend to rattle markets in the short term. Why? Because markets don’t like uncertainty. Prices fall not just on actual earnings or data, but on fear of what might come next.
What should you do now?
Volatility isn’t always a signal of real, long-term risk. It may be a reaction to the news. And while it’s normal to feel unsettled, it’s important to remember this: Reacting emotionally to a temporary dip can do more harm to your financial journey than the dip itself.
In a black swan event like this, investors who stayed invested — who continued their SIPs, didn’t pull out, and stuck to their long-term plans — were the ones who benefitted most when stability returned. Because it does return.
If you are invested in WealthBaskets, this is the time to stay the course and wait for the next rebalancing.
Panic is temporary, but discipline compounds.
