Trump tariff effect: Sensex down over 300 points, Nifty near 23,200 after US President announces reciprocal tariffs

“April, 2 2025, will forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed, and the day that we began to make America wealthy again. The tariffs Trump unveiled were worse than what the market had established as a worst case scenario,” said Vikram Kasat, head – advisory, PL Capital – Prabhudas Lilladher

However, the tariffs imposed on India were higher than the 24 per cent duty on Japan, 25 per cent on South Korea, 24 per cent on Malaysia, 20 per cent on the European Union, and 10 per cent on the UK. Notably, Trump announced 32 per cent tariffs on Taiwan, a key chip manufacturing centre.

The US President said he was only charging half of the tariffs that other countries were imposing on America.

The US will impose a 10 per cent base tariff on all countries from April 5, and an individualised reciprocal higher tariff on countries with which America has the largest trade deficits from April 9.

“In very general terms, Canada and Mexico have got off lightly, while those in Asia, particularly China and Vietnam, have been hit hard. The European Union and Japan sit somewhere in the middle. Just the hope – no one retaliates Since If you retaliate, there will be escalation. If you don’t retaliate, this is the high-water mark,” said Kasat.

According to Ankita Pathak, macro strategist and global equities fund advisor at Ionic Asset, India exports around $80 billion to the US of which machinery, apparels, pharma, agriculture, electronics and gems & jewelry are the major ones.

Therefore, unless some of these are exempted on grounds of non-availability in the US, these will be highly vulnerable sectors, she said.

“The prospect of a radical escalation in the global trade war in the coming days has nearly doubled the probability of a recession in the US economy in the next 12 months,” said Devarsh Vakil, head of prime research, HDFC Securities.