Sensex falls over 300 points on US-China trade tension; HeroMotoCorp biggest loser in early trade

Sensex fell over 300 points on Friday in line with global market sell-offs as investors panicked after the US decision to impose fresh tariffs on Chinese goods. The trade war tensions between the US and China along with unabated foreign fund outflows weighed heavily on the market sentiments, traders said to PTI. Global stocks took another beating on Friday with investors piling into safe-haven assets after US President Donald Trump said he would slap a 10% tariff on the remaining $300 billion of Chinese imports starting 1 September. Trump’s announcement, which came a day after US and Chinese negotiators concluded a meeting in Shanghai without significant signs of progress, marks an end to a truce in the trade war struck in June and could further disrupt global supply chains, a Reuters report said. [caption id=“attachment_6956291” align=“alignleft” width=“380”]  Representational image. Reuters.[/caption] Tracking tepid global market trend, the 30-share index was trading 333.32 points, or 0.90 percent, lower at 36,685.00. Similarly, the 50-share Nifty slipped 105.15 points, or 0.96 percent to 10,874.85. In the Sensex pack, HeroMotoCorp emerged as the biggest loser with a slide of 2.78 percent, followed by Vedanta, ONGC, Bajaj Finance, HCL Tech, Tata Steel. However, Bharti Airtel, Asian Paint, Tata Motors and Infosys gained in the morning trade. In the previous session, Sensex plunged 462.80 points or 1.23 percent to end at 37,018.32. The broader NSE Nifty dropped 138 points or 1.24 percent to close below the key 11,000-mark at 10,980.00.

#CNBCTV18Market | Market opens lower amid weak global cues, #Nifty trades below 11,000, #Sensex trades below 37,000
For more updates follow: https://t.co/ANrmMP8l59 pic.twitter.com/3sX5XaFJOg

— CNBC-TV18 (@CNBCTV18Live) August 2, 2019

Foreign investors sold shares worth Rs 1,056.55 crore on a net basis on Thursday, as per provisional data with stock exchanges.

#CNBCTV18Market | Sell-off continues in market, #Nifty turns negative for 2019 pic.twitter.com/NfXa66eY0Y

— CNBC-TV18 (@CNBCTV18Live) August 2, 2019

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MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.6 percent to its lowest since mid-June while Japan’s Nikkei tumbled 2.4 percent. Chinese stocks were also hit hard, with the benchmark Shanghai Composite and the blue-chip CSI300 down 1.5 percent and 1.6 percent, respectively, while Hong Kong’s Hang Seng dropped 2.2 percent. US stock futures slipped 0.4 percent in Asian trade after the S&P 500 skidded 0.9 percent to hit one-month lows overnight, while Pan-European Euro Stoxx 50 futures shed 1.9 percent.

Trump’s announcement, which came a day after US and Chinese negotiators concluded a meeting in Shanghai without significant signs of progress, marks an end to a truce in the trade war struck in June and could further disrupt global supply chains.

“After the US-China summit meeting, people had expected there would be a lull for quite some time,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.And the market was also relieved by signs of recovery in the semi-conductor sector. But now investors and companies will have to revise their such scenarios.” China’s state media quickly denounced the move, with the editor in chief of the Global Times saying on Friday that a trade deal between the United States and China was now “further away.” The war of words appeared to escalate after U.S. Secretary of State Mike Pompeo said “decades of bad behaviour” from China had hampered free trade and prompted tariffs and other action from Washington. The proposed levies triggered a stampede for safe-haven assets, including U.S. bonds, the yen and gold while the Chinese yuan and the Australian dollar hit multi-month lows. Meanwhile, the rupee declined by 21 paise to 69.27 against the US dollar in morning trade. The global oil benchmark Brent crude futures surged by 2.61 percent to 62.08 per barrel. --With agency inputs