India’s equity market is struggling to sustain its partial recovery from April’s steep sell-off as the Trump administration’s sweeping new tariffs collide with a sharp slowdown in corporate earnings. While valuations have clawed back some ground after an unprecedented ₹92 trillion market capitalisation loss from the September 2024 peak, the outlook remains challenging as global trade tensions deepen, policy buffers shrink, and investor flows weaken.Earnings growth is faltering. The Nifty 50’s profit growth slowed to an average of 3.5% in 2024-25, with just 0.25% growth in the January–March quarter. Early indications for the April–June quarter suggest that this weak trajectory is continuing, hurt by the 10% uniform tariff the US imposed from April 2025. Core sectors such as consumer goods, banking, IT and automobiles are witnessing broad-based demand slackness, leaving only materials with one-off support.
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