Investor confidence returned dramatically today as global markets staged a significant recovery following yesterday’s widespread sell-off triggered by escalating trade tensions.
In India, the Sensex surged past the 74,200 mark, climbing over 1,000 points, while the Nifty crossed 22,500. This rebound followed a tumultuous day where Indian indices experienced some of their steepest declines in recent years.
As analysts suggest, the initial wave of panic selling appears to have subsided, fueled by speculation that US President Donald Trump may reassess his current tariff policies.
The positive sentiment wasn’t limited to India. Across Asia and Europe, markets displayed a strong recovery:
- Japan’s Nikkei 225 jumped nearly 6%, rebounding from a 1.5-year low after reports of trade talks between President Trump and Japanese Prime Minister Shigeru Ishiba.
- Chinese blue-chips gained 0.7%.
- South Korea’s Kospi saw a rise of 1.7%.
- Hong Kong’s Hang Seng Index climbed over 2.25%.
However, not all markets participated in the recovery. Indonesia’s Jakarta Composite dropped more than 9%, and Vietnam’s benchmark index lost over 5% following a holiday.
European markets mirrored the overall trend of optimism, with STOXX 50 futures rallying by 2.2 per cent and US S&P 500 futures increasing by 0.9 per cent.
Yesterday’s turmoil saw Indian benchmark indices plummet. The BSE Sensex lost a substantial 2,226.79 points, closing at 73,137.90, representing a 2.95% decline. Intraday trading witnessed an even more significant drop of nearly 4%. Similarly, the NSE Nifty fell 742.85 points, or 3.24%, to settle at 22,161.60.
This downturn echoes a previous period of market instability: “The last time Sensex and Nifty experienced such a severe decline was on March 23, 2020, when the Covid-19 pandemic prompted widespread lockdowns.”
The broader global reaction to President Trump’s tariffs and subsequent retaliatory measures from China was swift and considerable. Asian markets witnessed significant losses:
- Hong Kong’s Hang Seng index fell more than 13%.
- Tokyo’s Nikkei 225 plunged nearly 8%.
- Shanghai SSE Composite Index dropped over 7%.
- South Korea’s Kospi sank over 5%.
European markets also faced intense selling pressure, experiencing declines exceeding 4%.
In the United States, Friday saw substantial losses as well. The S&P 500 tumbled 5.97%, the Nasdaq composite slumped 5.82%, and the Dow Jones Industrial Average fell by 5.50%.
