INDIA STOCKS-Indian shares endure US tariff jolt; relatively lower duties limit losses

Updates for markets close

By Bharath Rajeswaran and Vivek Kumar M

April 3 (Reuters) - Indian stocks weathered U.S. President Donald Trump's tariff storm with minor bruises on Thursday as investors expect the South Asian nation to benefit from a relatively lower tariff rate than its Asian peers.

Trump on Wednesday slapped a 26% reciprocal tariff on India, though an annexure to the order listed it at 27%, as a part of his plan to impose a 10% baseline tariff on all trade partners, with higher duties on dozens of countries, including China.

The Nifty 50 .NSEI fell 0.35% to 23,250.1 and BSE Sensex .BSESN lost 0.42% to 76,295.36, but fared better than most Asian peers, as analysts said India's relatively lower reciprocal tariffs compared to China, Vietnam, and Thailand could offer a competitive edge.

Key stock indexes in China and Hong Kong fell 0.3% and 1.5%, while Thailand and Vietnam traded about 1% and 6.7% lower.

Trump's tariffs have stoked fears of a U.S. recession, sending IT stocks .NIFTYIT down 4.2%, their sharpest drop in two years, and weighing on the Nifty 50. Analysts have warned of broader ripple effects on the U.S. economy, a key revenue source for Indian IT firms.

Akshat Garg, assistant vice president at Choice Wealth, said the impact could persist for a few sessions and may derail near-term market momentum given the sector's heavy weightage on the benchmark indexes.

Meanwhile, the Indian rupee INR=IN rose 0.08% to the U.S. dollar, holding up reasonably well amid a dip in most Asian currencies.

"India is relatively well-off, especially if some China or Vietnam exports get rerouted," Harsh Gupta, fund manager of PIPE at Ionic Asset said.

Six of the major equity sectors logged losses on the day. The broader smallcaps .NIFSMCP100 and midcaps .NIFMDCP100 rose 0.6% and 0.2%, respectively.

In contrast, pharma firms .NIPHARM jumped 2.25% after Trump exempted pharmaceutical products from the list of imports hit by reciprocal tariffs, offering a silver lining to the sector.

"Pharma stocks were being beaten down in 2025 so far due to the tariff uncertainty, now those stocks could witness a rally since the tariff announcement has no negative effect," said Sreeram Ramdas, vice president at Green Portfolio PMS.

Sun Pharma SUN.NS and Cipla CIPL.NS rose about 3.4% each and were among the top gainers on the Nifty 50. Lupin LUPN.NS gained 4.2% on the day.

(Reporting by Bharath Rajeswaran and Vivek Kumar M in Bengaluru; Editing by Savio D'Souza and Sonia Cheema)

((bharath.rajeswaran@thomsonreuters.com; +91 9769003463;))