Sharp fall in markets erode Rs 5.41 lakh cr of investors' wealth

New Delhi, Aug 26 (PTI) Investors' wealth eroded Rs 5.41 lakh crore on Tuesday as markets fell sharply, with the benchmark Sensex tumbling 849 points to close below the 81,000 level on Tuesday due to widespread selling pressure after the US issued a draft notice on the implementation of an additional 25 per cent tariff on Indian products.

The 30-share BSE Sensex tumbled 849.37 points, or 1.04 per cent, to close at 80,786.54 with 25 of its constituents ending lower and five with gains. During the day, the index nosedived 949.93 points, or 1.16 per cent, to hit a low of 80,685.98.

Persistent foreign fund outflows and losses in global equities following US President Donald Trump's firing of a Fed governor also dampened investor sentiment, analysts said.

Realty, pharma, banking and metal stocks bore the brunt of the selling, while FMCG shares displayed relative resilience with marginal gains.

The market capitalisation of BSE-listed firms eroded Rs 5,41,542.83 crore to Rs 4,49,45,420.62 (USD 5.12 trillion).

"Indian equity benchmarks on Tuesday witnessed a sharp selloff after the Trump administration formally issued a notice to impose an additional 25 per cent tariff on Indian imports, with the punitive duties scheduled to take effect from August 27.

"The announcement triggered a wave of risk-off sentiment across domestic markets, leading to broad-based weakness," Sudeep Shah, Head, Technical Research and Derivatives at SBI Securities, said.

Among the Sensex firms, Tata Steel, Trent, Bajaj Finance, Mahindra & Mahindra, Bajaj Finserv, Reliance Industries, Axis Bank, Tech Mahindra, Adani Ports, Titan, BEL, and Larsen & Toubro were the losers.

However, Hindustan Unilever, ITC, Tata Consultancy Services, and UltraTech Cement were the gainers.

Market breadth was negative as a total of 2,891 stocks declined, while 1,220 advanced and 130 remained unchanged on the BSE.

The BSE Smallcap index went lower by 1.68 per cent, while midcap gauge slipped 1.34 per cent.

Among BSE sectoral indices, realty plunged 2.24 per cent, followed by metal (2.10 per cent), telecommunication (2.04 per cent), energy (1.68 per cent), healthcare (1.65 per cent), utilities (1.61 per cent), industrials (1.59 per cent) and power (1.53 per cent).

FMCG was the only gainer.

According to Bajaj Broking Research, benchmark indices closed sharply lower on Tuesday, August 26, amid intense selloff pressure across key sectors, with bears firmly in control of Dalal Street.

The sharp correction was triggered by geopolitical jitters after a draft proposal surfaced, indicating former US President Donald Trump's intent to impose a steep 50 per cent tariff on Indian imports.

Sectoral breadth was deeply negative, with realty, pharma, and small caps leading the laggards.

Midcap also witnessed profit-booking, shedding over a per cent each. However, FMCG stocks bucked the trend, emerging as the lone sectoral gainer with a solid uptick of around 1 per cent, signalling a flight to defensives, it said.

The US has issued a draft order implementing an additional 25 per cent tariff on Indian products, which Trump announced earlier this month, beginning August 27.

According to the draft notice released by the Department of Homeland Security, the additional tariffs will cover Indian products "that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 am Eastern Daylight Time on August 27, 2025".

The notice explained that the higher levies were linked to "threats to the US by the government of the Russian Federation", with India targeted in line with that strategy. PTI HG TRB