Barely a week after Donald Trump imposing reciprocal tariffs on trading partners around the world, the Indian stock market suffered massive losses in early trade on Monday. This meltdown is a trend that's particularly being observed in bourses around the world as a trade war triggered by the US President looms on the horizon.

The 30-share BSE benchmark Sensex crashed 3,939.68 points or 5.22 per cent to 71,425.01 in early trade. The NSE Nifty tumbled 1,160.8 points or 5.06 per cent to 21,743.65.

The BSE Midcap and Smallcap indices have also dipped over 10 per cent.

Investors faced a staggering loss of nearly ₹16 lakh crore in a matter of minutes as the total market capitalisation of BSE-listed companies plummeted from over ₹403 lakh crore to ₹387 lakh crore in the latest trading session.

RIL, Tata Steel among laggards

All the Sensex firms were trading in the negative territory. Tata Steel dropped over 8 per cent, followed by Tata Motors which cracked more than 7 per cent. HCL Technologies, Tech Mahindra, Infosys, Larsen & Toubro, Tata Consultancy Services and Reliance Industries were the other big laggards.

In Asian markets, Hong Kong's Hang Seng tanked nearly 11 per cent, Tokyo's Nikkei 225 plunged nearly 7 per cent, Shanghai SSE Composite index dropped over 6 per cent and South Korea's Kospi index sank 5 per cent.

US markets ended sharply lower on Friday. The S&P 500 plummeted 5.97 per cent, Nasdaq composite slumped 5.82 per cent and the Dow tumbled 5.50 per cent on Friday.

"Both China and Japan index declined by 10 per cent and 8 per cent, respectively. This escalates the stakes in the ongoing trade war and raises concerns about a potential global recession that could affect everyone. On Friday, the US S&P 500 dropped by 6 per cent, and the Dow Jones fell more than 2,000 points, marking its worst week since the COVID-19 crisis. This came after China announced it would impose reciprocal 34 per cent tariffs on all US imports starting April 10," Vikas Jain, Head of Research at Reliance Securities, said.

The sharp increase in tariffs by both the US and China could lead to higher inflation, slower global growth, and intensify trade tensions, he added.

Major FII offload

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,483.98 crore on Friday, according to exchange data.

Global oil benchmark Brent crude dropped 2.74 per cent to USD 63.78 a barrel.

NSE MD says India better than other countries

Barely a day ago on Sunday, asserting that a situation of confusion persists in the world after the recent imposition of reciprocal tariffs by the US, NSE Managing Director and Chief Executive Officer Ashish Kumar Chauhan said India is doing much better than other countries.

He said a clear situation is expected to emerge within the next one or two weeks as there will be negotiations and the duty structure will be stabilised.

The National Stock Exchange (NSE) chief said it seems that the Indian share market is doing much better than other countries post the US decision on reciprocal tariff.

"You must have seen the market for the last 2-3 days. America has made a decision on tax, which is applicable to every country in the world. They have also imposed new import duties for India, which is doing better than other countries,” he said.

Chauhan, who met Lt Governor Manoj Sinha on reaching Jammu Saturday evening, said a clear picture about the future strategy of America and the world will be clear in the next week.

“It seems that India's position is a bit heavy compared to other countries,” he said.

"A situation of confusion persists as of now. Many feel that some companies may face more losses. But overall, there will be negotiations and the duty structure will be stabilized. The situation should be clear in the next one or two weeks,” he said.

Key stock market indices Sensex and Nifty declined over 2.5 per cent last week, dragged primarily by weak global cues and renewed concerns over a trade war after the US tariffs.

Top firms suffer dip in trade last week

Last week, the BSE benchmark gauge Sensex tanked 2,050.23 points or 2.64 per cent, while the NSE Nifty declined 614.8 points or 2.61 per cent.

From the top-10 pack, Tata Consultancy Services (TCS), Reliance Industries, Infosys, Bajaj Finance, ICICI Bank, HDFC Bank, Hindustan Unilever Ltd, State Bank of India and ITC faced erosion from their market valuation. Bharti Airtel emerged as the only gainer.

The market valuation of TCS tumbled by Rs 1,10,351.67 crore to Rs 11,93,769.89 crore.

The valuation of index bellwether Reliance Industries tanked by Rs 95,132.58 crore to Rs 16,30,244.96 crore and that of Infosys plunged by Rs 49,050.04 crore to Rs 6,03,178.45 crore.

Bajaj Finance's market capitalisation (mcap) declined by Rs 14,127.07 crore to Rs 5,40,588.05 crore and that of ICICI Bank dropped by Rs 9,503.66 crore to Rs 9,43,264.95 crore.

Private sector lender HDFC Bank's valuation diminished by Rs 8,800.05 crore to Rs 13,90,408.68 crore and that of Hindustan Unilever Ltd dipped by Rs 3,500.89 crore to Rs 5,27,354.01 crore.