Millions of small investors have piled into India’s stock market in recent years, eager to build wealth by betting on the country’s economic growth. Catchy advertising and easy-to-open online trading accounts have wooed young people and retirees alike, demystifying investing and fueling the exuberance.
This week, many of those investors got a rude shock — and an introduction to the pitfalls of globalization — when Indian markets buckled from fears that President Trump’s new tariff regime would induce a global recession.
On Monday, the Indian stock market lost around $170 billion in value as its two biggest indexes plummeted, mirroring global markets that have swung wildly as investors game out the likelihood of a downturn. By Tuesday, the domestic market had rebounded, and many analysts were sanguine about India’s economic advantages in trade negotiations with the United States.
On Wednesday, though, India’s Sensex and Nifty 50 indexes were down again as a 27 percent tariff on Indian exports to the United States took effect. India’s central bank cut interest rates and reduced its growth forecast, citing the rapidly changing global landscape.
“The recent trade tariff-related measures have exacerbated uncertainties, clouding the economic outlook across regions, posing new headwinds for global growth and inflation,” Sanjay Malhotra, the governor of the Reserve Bank of India, said in a speech.
Many everyday investors, especially first-timers, were lurching between confusion and terror, unsure whether to blame their trading strategies or Mr. Trump.
“Of course I’m worried,” said Gaurav Goyal, a 32-year-old entrepreneur who began investing about a year ago. “Nobody wants to see a red portfolio.”
Mr. Goyal said his stock holdings had fallen by 10 percent since Mr. Trump took office, and he was debating whether to keep trading stocks or buy safer assets like gold.
“The one and only Donald Trump,” he said, was to blame for the state of affairs.
Ordinary Indians have flocked into stocks as regulators and the financial services industry have made it easier to invest, with trading platforms advertising heavily, said Girish Kodashettar, a certified financial planner based in Bengaluru.
“A lot of awareness was created,” Mr. Kodashettar said.
The popularity of online trading accounts coincided with a steady rise in the Indian stock market, “meaning that new investors have only seen a one-way run,” said Pranjal Kamra, the founder and chief executive of Finology, a financial advisory firm. “They haven’t seen fluctuation or the market falling.”
Between March 2020, when the pandemic lockdowns began, and September 2024, the Nifty 50 stock index, made up of the 50 biggest Indian companies that trade on the National Stock Exchange, more than tripled in value. The index has since tailed off.
Mr. Kamra said he hadn’t heard about animosity toward the United States or Mr. Trump because of the wobbly market or Monday’s crash. But there is an overarching fear, he said. To pacify nervous investors, “I’d send an emoji that signifies calm and meditation to everyone panicking,” Mr. Kamra said. “A Buddha meditating!”
The market mayhem has produced moments of levity. Some internet users started using the term “Orange Monday,” a reference to the “Black Monday” crash of 1987 and to the hue of Mr. Trump’s skin. Others went with “Orange Is the New Black.”
Shubham Sachdeva, a 30-year-old chartered accountant whose stock holdings had fallen by 5 percent in recent days, said the United States was at the “epicenter” of a movement away from free trade. “Globalization, which integrated the world in the 1980s and 1990s for collective growth, now faces the opposite trend,” he said.
Some analysts and experienced investors took a more measured view, saying that short-term disturbances from the tariff negotiations were unlikely to impede India’s bigger growth story and, therefore, the market’s long-term trajectory.
“There is no need to blame anyone for the situation,” said Nilesh Shah, a managing director at Kotak Mahindra Asset Management. The United States is doing what Mr. Trump believes it needs to do to address trade imbalances, Mr. Shah said, and “India has to deal with the current situation to create a win-win situation by becoming the U.S.’s preferred partner.”
Plenty of people in India were still bullish. Rachana Ranade, a chartered accountant and finance educator with 5.2 million YouTube subscribers, said many investors saw the rout as an opportunity.
“Since yesterday, no one has asked me if this was the time to sell,” Ms. Ranade said on Tuesday. “They have all asked if this was a good time to add more.” A depressed market is ripe with opportunity, she said.
“Sentiment is not good right now,” Ms. Ranade said. “But the prices are good.”
