Sensex and Nifty Decline as US Tariffs Impact IT and Chemical Sectors; Pharma Stocks Gain

Market Performance

The Indian stock market declined on April 3, 2025, following the announcement of reciprocal tariffs by the United States. The Sensex fell by 322.08 points, or 0.42%, to close at 76,295.36. During intraday trading, the index saw a sharp decline of 809.89 points, hitting a low of 75,807.55. Similarly, the Nifty 50 dropped by 82.25 points, or 0.35%, settling at 23,250.10. It initially declined by 186.55 points to 23,145.80 before recovering some losses.

Despite the weakness in the leading indices, broader markets performed better, with the Nifty Midcap 100 and Smallcap 100 indices gaining nearly 0.5%.

Impact of Tariffs on Key Sectors

IT Sector Decline

The announcement of a 27% reciprocal tariff on Indian exports to the United States significantly impacted the IT sector. The Nifty IT index registered a 4% decline during intraday trading. Major IT companies, including Infosys, Tata Consultancy Services (TCS), and HCL Technologies, saw declines in their share prices.

Chemical Sector Under Pressure

Shares of Indian chemical manufacturers also faced pressure following the tariff announcement. The increase in import duties is expected to reduce Indian exports to the US, impacting revenue and profit margins. Previously, the sector operated with an import duty of 3.5%, increasing the new tariff considerably.

Pharma Sector Gains

Pharmaceutical stocks outperformed, benefitting from an exemption in the tariff hike. The Nifty Pharma index surged up to 3%, with leading stocks such as IPCA Labs, Sun Pharma, and Lupin witnessing gains of up to 5%.

Textile and Manufacturing Sectors

Textile stocks performed well, as the new tariff regime was seen as potentially increasing India's competitiveness against other Asian exporters. Investor interest in the textile and electronics manufacturing services (EMS) sectors increased.

Company Performance

Infosys Share Price

Infosys shares fell by 3.46%, closing at 1,496.50, with a trading volume of 10,459,504. The stock reached an intraday low of 1,485.05 and a high of 1,534.65.

Summary

The Indian stock market closed lower on April 3, 2025, due to a selloff in IT, chemical, and auto stocks following the US government's decision to impose a 27% reciprocal tariff on Indian exports. While broader markets displayed resilience, the IT sector saw a decline, whereas the pharmaceutical sector gained due to tariff exemptions. The textile industry also showed positive movement, reflecting optimism regarding India's export competitiveness.