Stock Market Today: Sensex and Nifty Drop Amid Global Selloff

Pharma, auto, and metal stocks take a beating as US tariffs rattle global markets

The Indian stock market faced a sharp correction on April 4, 2025, as benchmark indices extended their losses amid global turmoil. The BSE Sensex and the NSE Nifty 50 ended the session deep in the red, mirroring global investor concerns triggered by a wave of tariff announcements from the United States. Volatility remained high throughout the session, as participants responded to escalating trade tensions, sector-specific concerns, and heavy foreign institutional selling.

Market Summary – April 4, 2025

The trading day opened on a cautious note, with both the Sensex and Nifty beginning slightly lower. However, as global cues worsened, Indian equities saw intensified selling pressure.

Mid-cap and small-cap indices also posted losses, reflecting broad-based selling across the market. The Nifty Midcap 100 and Smallcap 100 declined over 1.5%, underperforming the large-cap benchmark.

Key Drivers Behind the Market Selloff

1. US Tariffs Targeting Indian Exports

Recent announcements from the US administration introduced a 26% tariff on a range of Indian imports. Though the rate was comparatively lower than tariffs imposed on other Asian nations, the move disrupted investor confidence. Concerns escalated over the potential impact on India's export-driven sectors, particularly information technology, pharmaceuticals, and auto components. Market participants braced for possible retaliatory actions and disruptions in trade volumes.

2. Global Market Meltdown

The negative sentiment in India mirrored a broader global market selloff. US indices witnessed steep declines, with the S&P 500 dropping 4.85% and the Nasdaq plunging nearly 6%. Asian markets followed the same trajectory, registering week-long declines amid fears of a trade-induced global economic slowdown. The Japanese Nikkei saw a nearly 10% drop during the week, while European markets struggled to recover from earlier losses.

3. Sectoral Losses Deepen

The impact of global cues was felt most sharply in sectors directly tied to international trade.
Pharmaceutical stocks came under intense selling pressure. The Nifty Pharma index fell by 4.4% as fears mounted over additional tariffs affecting drug exports. Major players such as Sun Pharma and Dr. Reddy’s Laboratories witnessed intraday losses exceeding 6%.

Metal stocks dropped sharply, with the Nifty Metal index losing around 4%. Stocks like Hindustan Copper and Vedanta posted significant declines. Concerns over demand slowdowns and raw material pricing disruptions contributed to the negative outlook.

Auto and auto component companies were among the hardest hit. Tata Motors, Bharat Forge, and Motherson Sumi Systems saw their stock prices fall by as much as 8%, reflecting worries about demand contraction from overseas markets.

Banking and financial stocks also remained weak, as global uncertainties sparked concerns about credit risk, currency fluctuations, and tightening liquidity.

4. Government Disinvestment Plans

In a move to raise capital, the Indian government announced the sale of a 4.83% stake in Mazagon Dock Shipbuilders Ltd. via an Offer for Sale (OFS). The floor price was set at ₹2,525 per share, which was about 8% below the previous day’s closing price. This move added pressure on PSU stock prices, particularly in the defense and infrastructure segments.

Broader Market Indicators

The India VIX, a measure of market volatility, rose significantly during the session, indicating heightened uncertainty. Turnover in the cash and derivatives segments remained elevated, driven by institutional trades and risk hedging.

Foreign institutional investors (FIIs) turned net sellers for the third consecutive day, intensifying the downward pressure. Domestic institutional investors (DIIs) provided some support, but were unable to counterbalance the scale of FII selling.

Currency markets also reflected the risk-off sentiment. The Indian rupee depreciated against the US dollar, ending the day at 83.52, down by 19 paise. Weakness in the rupee added to the woes of companies with significant import exposure.

Sector Performance Snapshot

Pharma, metals, and auto remained the biggest laggards. Defensive sectors like FMCG and real estate witnessed relatively lower declines, supported by domestic demand resilience.

Pre-Earnings Season Jitters

With the corporate earnings season set to begin next week, market participants showed caution. Companies across IT, BFSI, and manufacturing sectors are scheduled to report March quarter results in the coming days. Market volatility may continue as traders assess forward guidance, margin pressures, and post-festive quarter growth data.

Technical Analysis and Market Outlook

Nifty breached its 23,000 support level during the session but managed to recover slightly before the close. Technical indicators now point toward a bearish setup. If the index fails to hold above 22,950 in upcoming sessions, further downside could lead to testing the 22,700–22,600 range.

The Sensex mirrored this pattern, with 75,000 emerging as the next critical support zone. Resistance is expected near 76,400 for both indices.

Momentum indicators on daily charts suggest weakness in buying interest. Volume spiked on the sell side, indicating that institutional players contributed heavily to the decline.

Commodities and Global Trends

Crude oil prices rose despite global equity market corrections. Brent crude traded around $89 per barrel, supported by concerns about supply disruptions amid geopolitical tensions in the Middle East. Rising energy prices could pressure margins for Indian companies across transportation, aviation, and manufacturing.

Gold prices remained firm, trading above ₹64,500 per 10 grams, as investors sought safe-haven assets. The demand for gold, both physical and financial, surged amid fears of global economic instability.

The Indian stock market's performance on April 4, 2025, reflects heightened global uncertainty, rising geopolitical risks, and growing concern over trade protectionism. Sector-specific pressure, particularly in export-oriented industries, contributed to broad-based selling.

Investors are now closely watching central bank commentary, earnings results, and further geopolitical developments. With volatility rising and key support levels under pressure, cautious positioning may dominate the market mood in the short term. Active tracking of global developments and domestic policy measures will remain critical in navigating the current market landscape.