The Indian stock market is experiencing selling pressure, seemingly disregarding positive developments like the recent GST rate cut, GDP Data. Despite a 250-point gap up on September 4, 2025, following the GST announcement, Nifty 50 couldn’t sustain its gains and fell immediately after opening. This market behavior appears to be driven by fears of “Trump Tariff Terror,” specifically 50% tariff on Indian goods, which could significantly impact exports and the economy.

Key Factors Influencing Market Sentiment:

GST Rate Cut: Although the market initially reacted positively, the gains weren’t sustained due to overriding concerns about US tariffs.

US Tariffs: The proposed 50% tariff on Indian goods could reduce India’s export competitiveness, potentially leading to job losses and economic slowdown.
Trade Relations: Strains in US-India trade relations might escalate into a trade war, harming both economies.
Technical Analysis:
Nifty 50 Support Level: Despite Trump Tariff Terror, the index has defended the 24,300 level twice, indicating strong support.
Morning Star Pattern: Formed on September 1, 2025, this pattern suggests a potential reversal in market trend.

Future Outlook:

Durable Bottom: The market might form a durable bottom on extreme negative news or start moving up from here also with positive developments like a ceasefire between Russia and Ukraine or stability in US tariff policy.

US-India Trade Deal: A potential trade deal between the two countries could boost market sentiment and economic growth ¹.

In conclusion, while the market is currently driven by fears of US tariffs, it’s unlikely to ignore positive macro developments like GST rate reduction, GDP growth, and low inflation for an extended period. The 24,300 level is expected to act as strong support for Nifty 50  and a close below this level could lead to further downside.

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