Stock Market Crash: Why Are Markets on a Downtrend Today?

Synopsis: Markets fell today as discussions of a strict new US sanctions bill on Russia frightened investors. The bill targets countries that continue to purchase Russian oil, including India, and threatens to raise tariffs by upto 500%. 

Markets noted a sharp plunge today after investors were rattled after hearing that the US might impose much higher tariffs on countries buying Russian oil, including India. The new sanctions bill, signed by President Trump, has people concerned about escalating trade tensions. In this article, we will dive deeper into understanding this bill and the market reaction to it.

What happened

President Donald Trump has just approved a tough new sanctions bill targeting Russia. This move not only increases pressure on Moscow, but it will also impact countries that conduct business with Russia. Washington is signaling that it wants an end to the war in Ukraine. Senator Lindsey Graham, a Republican, stated that Trump has given his approval, and Congress could vote on the bill as early as next week.

What is the bill about:

The Sanctioning Russia Act of 2025 gives the US government the authority to impose tough penalties on Russia and its partners if they assist Moscow in continuing the war, especially by purchasing Russian crude oil, which the US argues is essentially funding the conflict. 

The law allows officials to deny visas, freeze assets, and impose hefty import tariffs, sometimes reaching as high as 500 percent. It mainly targets countries that buy Russian oil, gas, or uranium, since the US views those transactions as a way for Russia to sustain its military operations.

How it can impact India:

India imports significant amounts of oil from Russia and already faces high US tariffs, which are up to 50 percent on certain goods. If this bill is approved, the US could raise those tariffs to as much as 500 percent . That’s a massive increase. 

Indian exporters would suffer, their products would become much pricier in the US, and trade tensions would almost certainly escalate. Despite all this, India continues to purchase Russian oil because it’s more affordable and the country relies on it to satisfy its energy needs.

Market Wise Implications

With this news spreading like fire in the market, export-oriented stocks fell harder in today’s trade. Gokaldas Exports, which derives nearly 75 percent of its revenue from the United States, fell by 13 percent in today’s trade. Avanti feeds, which derives a staggering 67 percent of its processed shrimp sales from North America, plunged over 8 percent. Also, Apex Frozen, which derives 50 percent of its sales from the US, also felt the heat, plunging over 7.5 percent in today’s trade.

Sensex declined by 0.86 percent from its day high of 84,965.27, reaching its day low of 84,230.95. NIFTY 50 also took the hit, plunging by 0.95 percent from its day high of 26,133.20, reaching its day low of 25,884.15. Nifty IT, NIFTY Bank, NIFTY Midcap 50, and NIFTY Smallcap 250 were down by 1.53 percent, 0.53 percent, 1.27 percent and 1.46 percent respectively.

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