Trump’s Pharma Tariffs, IT Woes Slam Markets - Investor Sentiment Crumbles
Wall Street's optimism evaporates as new policy threats emerge.
Double Trouble for Markets
President Trump's proposed pharmaceutical tariffs collide with mounting IT sector concerns, creating a perfect storm that's hammering investor confidence. The dual pressures send shockwaves through trading floors as portfolios take unexpected hits.
The Tariff Tumble
Pharma stocks lead the decline after Trump's tariff announcement targets key medical imports. Healthcare investors scramble to reposition while market analysts warn of ripple effects across related sectors.
Tech Sector Jitters
Simultaneous IT security concerns amplify the sell-off, with major tech players seeing unusual volatility. The combination of policy uncertainty and technical vulnerabilities creates a classic risk-off scenario.
Traditional finance proves once again that centralized policy decisions remain the ultimate market vulnerability—something crypto natives have understood for years.
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The tariff announcement came alongside steep hikes in US H-1B visa fees, triggering heavy selling in IT sector stocks. Wipro fell 1.66 per cent to ₹237.99, while Infosys dropped 1.65 per cent to ₹1,460.30. “Trump is now moving from country-specific tariffs to product-specific tariffs,” noted Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited. He added that “higher tariffs on trucks, upholstered furniture indicates that the Trump administration’s weaponisation of tariffs may continue till US inflation spikes.”
Foreign institutional investors extended their selling streak for the fourth consecutive session, offloading equities worth ₹4,995 crore on September 25. For September overall, FIIs have withdrawn ₹24,454 crore, though domestic institutional investors provided support with net purchases of ₹5,103 crore. “DIIs have stepped in with nearly ₹50,000 crore of inflows—underscoring resilient domestic conviction even as global uncertainties mount,” Ponmudi R observed.
The rupee’s weakness to record lows NEAR ₹88.7 against the dollar and rising volatility, with India VIX up 3.5 per cent, added to investor concerns. “Sentiments at Dalal Street remain fragile, pressured by three big negatives: Trump’s steep tariffs and H-1B visa fee hike, Powell’s stagflation fears, and the rupee’s tumble,” said Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd.
Auto stocks emerged as the day’s bright spot, with Larsen & Toubro leading Nifty gainers, rising 1.69 per cent to ₹3,706.00. Tata Motors gained 1.68 per cent to ₹675.45, while Hero MotoCorp advanced 1.21 per cent to ₹5,419.50. Maruti Suzuki climbed 0.92 per cent to ₹16,418.00, and Eicher Motors ROSE 0.81 per cent to ₹7,042.50.
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From a technical perspective, the Nifty has breached the crucial 25,000 psychological level and is now trading within a descending channel. “A breach below 24,750 on the Nifty could accelerate the decline toward the 24,600–24,500 zone,” warned Ponmudi R. Hariprasad K, SEBI-registered Research Analyst at Livelong Wealth, noted that “with RSI (14) at 46.20 and trending below its moving average, the index reflects a neutral-to-bearish bias.”
Bank Nifty also faced selling pressure, trading below the 55,000 level with immediate support at 54,900. “A sustained breakdown below this level may trigger further selling, with potential downside targets at 54,800 and 54,500,” said Amruta Shinde, Technical Analyst at Choice Equity Broking. IndusInd Bank declined 1.32 per cent to ₹730.95, reflecting the broader banking sector weakness.
Gold remained firm at $3,778, supported by safe-haven flows ahead of US inflation data and rising geopolitical risks. Rahul Kalantri, VP Commodities at Mehta Equities, noted that “gold retained safe-haven demand after President Trump announced new tariffs effective October 1.”
Market participants are closely watching the RBI policy outcome on October 1 and the upcoming Q2 earnings season. “Investors can utilise dips to slowly accumulate high quality stocks, particularly those that are driven by domestic consumption,” advised Dr. Vijayakumar, suggesting a selective approach amid the current volatility.
With broad-based sectoral weakness across auto, IT, pharma, and consumer durables, and metals standing out as the lone pocket of strength, analysts recommend maintaining a cautious stance with tight stop-losses as volatility is expected to remain elevated.
Published on September 26, 2025
