Sensex, Nifty stare at gap-down start after US stocks eke out $2.4 trillion, Asian meltdown

Indian stock markets are staring at another gap-down opening on Friday after a sharp sell off in the global markets in the previous session, which came after Trump announced steepest trade barriers in more than 100 years, sending investors scrambling for safety assets amid global recession fears.

Nifty futures on the NSE International Exchange traded 125.95 points or 0.54 per cent down, at 22,200, hinting at a negative start for the domestic market on Friday. Asian stocks limped to the end of the week on Friday amid the fears that tariffs would tip the global economy into a recession.

Asian stocks continued to struggle in the early trade on Friday, reacting to sharp fall in the US stocks. Leading the Asian pack, Japan's Nikkei crashed nearly 2.5 per cent, while Australia's ASX200 was down 1.65 per cent. Hong Kong's Hang Seng fell 1.5 per cent in the early hours.

The higher-than-expected reciprocal tariffs and related global uncertainties have intensified, driven by geopolitical conflicts. This will disrupt supply chains and trade and industrial policies, including tariff disputes, thereby creating investment and trade uncertainties, along with volatility in bond yields and currencies, said Madhusudhan Sarda, Fund Manager at Almondz Global.

"The extent of the impact on India will depend on the US-India bilateral agreement over the next few months. India will have to look at lowering both tariff and non-tariff barriers such as surcharges on imports from the US in sectors. Lower tariffs could induce higher competition for domestic companies," he said.

While India’s trade surplus with the US is significant, prolonged tariffs may force us to explore alternative economic partnerships to safeguard growth, said Nikunj Saraf, Vice President at Choice Wealth. "If these duties persist and impact our economy, a strategic shift toward newer markets and domestic resilience will be imperative," he said.

Major US stock indices registered their biggest daily percentage drops since 2020 on Thursday as Trump's drastic trade tariffs stoked fears of a global recession. S&P 500 companies lost a combined $2.4 trillion in stock market value, their biggest one-day loss since the coronavirus pandemic hit global markets on March 16, 2020. The Dow Jones crashed 4 per cent, while S&P 500 dropped 5 per cent. Nasdaq Composite cracked 6 per cent on Thursday.

Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services believes that the impact of reciprocal tariffs on India will be limited on a national basis. There is a possibility that the impact could further be reduced as India is in the process of negotiating a bilateral agreement with the US.

"With the major event now done-with, market focus will now shift towards the RBI’s monetary policy due one April 09 and the Q4FY25 earnings season kicking off from next week," he said.

Eight OPEC+ countries unexpectedly agreed to advance their plan to phase out oil output cuts by increasing output by 411,000 barrels per day in May. Oil extended declines after OPEC updated its plans in a statement, with Brent crude dropping over 6 per cent to below $70 a barrel. Against a basket of currencies, the dollar languished near a six-month low at 102.04.

Nifty is stuck in a 200-point range, facing resistance around the 23400 zone, said Chandan Taparia, Head Derivatives & Technicals at Motilal Oswal Financial Services. "While profit booking is seen at higher levels, buyers are actively defending key support areas. The index has formed a small-bodied candle, while the daily chart reflects a bullish structure suggesting mixed sentiment."

The Nifty opened lower following weak global cues but recovered immediately. Sentiment remains strong as the Indian market showed resilience despite weak global equity trends led by Trump's tariffs, said Rupak De, Senior Technical Analyst at LKP Securities. "Short-term support is placed at 23,100, and as long as the Nifty stays above this level, the trend is likely to remain strong. On the higher end, it may move towards 23,430, and a decisive move above this could trigger a stronger rally," he said.
 

On the higher side 52,000 will be a resistance and expect some consolidation at the current range with supports near to 50,350 levels which is the breakout and 100-day SMA, said Vikas Jain, Head of Research at Reliance Securities. RSI is piercing downwards from the average line and other key technical indicators are overbought from current levels, he said.


Bank Nifty posted strong gains closing near 51,600 level. Expect 51,000 to act as a strong support zone on the downside, while 51,800 will be immediate resistance, said  Satish Chandra Aluri, Lemonn Markets Desk.
 

Bank Nifty absorbed the ‘Trump Tariff Blow’ and edged upward, but uncertainty remains as markets crave stability, said Prashanth Tapse, Senior VP (Research), Mehta Equities. "The preferred trade remains selling Nifty (targets 22,700) and Bank Nifty (targets 49,500), with M&M Financial as the top sell pick due to bearish technical patterns," he said.