Nifty fear gauge India VIX jumps 6% amid renewed trade tensions

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India’s fear gauge, the Volatility Index (India VIX), surged over 6% to 21.68 on Wednesday, signalling rising investor anxiety amid a sharp selloff in global equities and renewed trade tensions.

The spike in volatility comes as U.S. President Donald Trump vowed to impose “major tariffs” on pharmaceutical imports, sending Indian pharma stocks tumbling up to 6%.


Meanwhile, metal stocks dropped as much as 4% after the U.S. raised import duties on Chinese goods by 50%, taking the total tariff burden to 104%. The move has raised concerns of China diverting its steel exports to other markets like India, intensifying competition for domestic producers.

The growing fears of stagflation and a possible recession in the U.S. also weighed on sentiment, dragging down IT stocks and adding to market jitters.


In early trade, the BSE Sensex declined 403 points, or 0.54%, to 73,823, while the Nifty50 dropped 146 points, or 0.65%, to 22,389 around 9:30 am.

“With a whopping 104% tariff on China likely to kick in today, there is blood on the streets. Uncertainty reigns supreme. How global trade and the global economy evolve from this chaos remains to be seen,” said Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.“Two things are clear: India will be one of the large economies least impacted by this Trump shakeout. Our domestic consumption segments are resilient. The expected 25 bps cut in policy rates in today’s monetary policy announcement could provide further monetary stimulus. The crash in crude oil prices is another big positive for the Indian economy,” he added.Also Read: Sensex falls 400 pts, Nifty below 22,400 as caution reigns on D-St ahead of RBI MPC outcome, escalating US-China friction

In early Asian trade, S&P 500 futures were down 1.5%, while Nasdaq futures fell 1.7%. The selloff also extended to Europe, with EUROSTOXX 50 futures down 4.5% and FTSE futures dropping 2.5%.

In Asia, China's blue-chip index slipped 1.2%, while Hong Kong's Hang Seng tumbled 3.1%. MSCI's broadest index of Asia-Pacific shares outside Japan declined 1.7%.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)

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