Stock market indices set to open significantly lower due to negative signals; Asian markets drop by as much as 4% amidst concerns over trade tensions.

The Indian share market is bracing for a bearish start to the week, influenced by the downturn in Asian markets that plummeted by up to 4% due to escalating trade war concerns following new U.S. tariffs on goods from Canada, Mexico, and China. The negative sentiment in the Gift Nifty index also portends a grim opening for the Sensex and Nifty, as Nifty futures are trading down by 0.71% at the 23,382 mark. Investors are now turning their attention to the upcoming monetary policy announcements from the RBI and Bank of England, while keeping a close eye on the directives set by the U.S. President Donald Trump administration.

Factors such as the flow of foreign funds, movement of the rupee, macroeconomic indicators, and fluctuations in crude oil prices are expected to exert significant influence on the market’s performance. Additionally, stock-specific reactions are anticipated as companies like Hero MotoCorp, Eicher Motors, GR Infraprojects, and Neogen Chemicals have released their earnings reports over the weekend. On the horizon, Power Grid Corporation of India, Tata Chemicals, Aditya Birla Capital, Divis Laboratories, and Alembic Pharmaceuticals are scheduled to unveil their Q3 results today.

In a volatile trading session, Wall Street closed lower on Friday after the White House confirmed the imposition of tariffs on imports from Canada and Mexico, instigating a retreat in major indices. President Trump’s administration is poised to levy 25% tariffs on Canadian and Mexican imports and has issued warnings regarding potential 100% tariffs on BRICS countries should they abandon the U.S. dollar. The Dow Jones Industrial Average was down by 0.75%, the S&P 500 dropped by 0.5%, and the Nasdaq Composite experienced a 0.3% decline at the close of Friday’s trading session.

Following suit, the Asian markets suffered losses of up to 4% on Monday, mirroring the apprehensive sentiment from Wall Street due to widening concerns over potential trade conflicts. Japan’s Nikkei 225 plummeted over 2.5%, South Korea’s KOSPI fell by 2.9%, and Australia’s ASX 200 closed 1.65% lower. In the wake of Lunar New Year holidays, Hong Kong’s Hang Seng dropped by 1.5%, and Taiwan’s Weighted index crashed by 3.7%.

Conversely, Indian equities concluded the Budget day trading session with modest gains on Saturday after the Union Budget 2025-2026 was presented in Parliament by Finance Minister Nirmala Sitharaman. The Sensex inched up by 0.01%, closing at 77,505.96, while the Nifty 50 exhibited a marginal decline of 0.11%, settling at 23,482.15. Among sectoral indices, FMCG, real estate, and auto sectors registered gains on expectations of increased consumption following tax relief to the middle class. On the other hand, PSU banks, metals, pharmaceuticals, and oil & gas industries emerged as the top laggards.

Looking ahead, several companies are set to disclose their quarterly earnings today, including Power Grid Corporation of India, Tata Chemicals, DOMS Industries, Aditya Birla Capital, and Divis Laboratories among others. Additionally, notable developments include the completion of a pre-approval inspection by the U.S. FDA at Lupin’s manufacturing facility in New Jersey, an increase in the marginal cost of funds-based lending rate by Indian Bank, and the reported drop in coal production by Coal India in January.

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