Indian Markets Crash 1% as Trump Approves 500% Tariff Bill on Russian Oil Buyers
Indian equity markets witnessed their steepest fall in over four months as Trump approved legislation imposing 500% tariffs on Russian oil buyers including India. The Nifty 50 breached 26,000 level, falling 263.90 points, while metal stocks led the decline with Nifty Metal down 3.4%. The development validates Kotak Mahindra Bank chairman's earlier prediction about US leveraging absolute power under Trump administration.
*this image is generated using AI for illustrative purposes only.
Indian equity markets witnessed their steepest fall in over four months as the Nifty 50 breached the crucial 26,000 level following reports that US President Donald Trump approved legislation proposing a staggering 500% tariff on countries importing Russian oil. The development validates Kotak Mahindra Bank chairman Uday Kotak's earlier prediction about the US leveraging its "absolute power" under Trump's administration.
Market Performance and Key Declines
The BSE Sensex closed 780.18 points or 0.92% lower at 84,180.96, while the Nifty 50 shed 263.90 points or 1.01% to settle at 25,876.85, marking its fourth consecutive negative close. Market breadth remained decidedly negative with 3,225 stocks declining against just 992 advances on the BSE.
| Market Index: | Closing Level | Points Change | Percentage Change |
|---|---|---|---|
| BSE Sensex: | 84,180.96 | -780.18 | -0.92% |
| Nifty 50: | 25,876.85 | -263.90 | -1.01% |
| Nifty Midcap 100: | 60,222.55 | -1,202.15 | -1.96% |
| Nifty Smallcap 100: | 17,601.05 | -357.45 | -1.99% |
Sectoral Impact and Top Decliners
Metal stocks bore the brunt of the sell-off, with the Nifty Metal index plummeting 3.4% as commodity prices weakened globally. Only four stocks managed to close in the green on the Nifty 50, led by Eicher Motors, which gained 0.78% to close at ₹283.15.
| Top Decliners: | Closing Price | Percentage Change |
|---|---|---|
| Hindalco Industries: | ₹903.00 | -3.78% |
| Jio Financial Services: | ₹292.65 | -3.57% |
| Wipro: | ₹261.90 | -3.29% |
| ONGC: | ₹231.20 | -3.29% |
| Tech Mahindra: | ₹1,575.90 | -3.03% |
Sanctioning Russia Act 2025: Legislative Framework
The legislation grants President Trump authority to impose strict penalties if Russia refuses peace negotiations or attempts to undermine Ukraine's government. Senator Lindsey Graham announced Trump's approval following their meeting, with the Senate expected to vote as early as next week. The bill specifically targets major Russian oil buyers including China, India, and Brazil.
| Sanctions Framework: | Details |
|---|---|
| Import Duties: | 500% minimum on goods from Russia-trading countries |
| Target Countries: | China, India, Brazil (major Russian oil buyers) |
| Additional Measures: | Visa bans, asset freezes on Russian officials |
| Banking Sanctions: | Block Russian bank assets and affiliated institutions |
Currency and Commodity Impact
The rupee depreciated 6 paise to close at 89.93 against the dollar amid renewed outflows from Indian markets. Gold prices on MCX fell nearly ₹900 to ₹1,36,950 despite relatively steady international prices, with rupee volatility weighing on domestic bullion sentiment.
Kotak's Prescient Warning Materializes
Kotak had previously warned that "the US is the absolute power on planet earth: military, finance, technology. Under Donald Trump it will leverage dominance." His November 2024 forecast regarding Trump's trajectory is now "playing out as anticipated" as India faces escalating trade pressures. The country currently faces 50% tariffs on exports to the US and ranks as the second-largest purchaser of Russian crude oil globally, having bought $143.88 billion worth since the Ukraine conflict began.
| India's Trade Challenge: | Current Status |
|---|---|
| Existing US Tariffs: | 50% total on Indian goods |
| Proposed Escalation: | 500% on Russian oil-buying countries |
| Russian Oil Purchases: | $143.88 billion since Ukraine conflict |
| Global Ranking: | Second-largest Russian crude buyer |
Market Outlook
Market participants remain cautious amid heightened geopolitical tensions and the approaching earnings season. "We expect the market to remain under pressure in the near term, dragged by concerns over US tariffs, ongoing geopolitical tensions and weak global market cues," said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. However, corporate earnings are expected to see sharp improvement in the third quarter, which could provide some support to sentiment.
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