Nifty Pharma experienced a significant downturn on Friday, plummeting by 6% amidst remarks from former U.S. President Donald Trump regarding forthcoming pharmaceutical tariffs. Speaking to reporters aboard Air Force One, Trump hinted at unprecedented tariff levels for the pharmaceutical sector, stating, "We are categorizing pharmaceuticals separately. An announcement will follow soon." This revelation has sent ripples through the market, reversing the gains made just a day prior.

Impact of Trump’s Remarks on Pharma Stocks

Following Trump’s comments, Indian pharmaceutical stocks saw a substantial decline, erasing the previous day’s gains. On April 3, these stocks had rallied after the former president previously exempted the industry from newly introduced tariffs. However, this optimism proved short-lived as investors reacted to the new developments.

• Key Pharma Stocks Affected:
  • IPCA Laboratories
  • Laurus Labs
  • Aurobindo Pharma
  • Lupin

Market Performance and Expert Insights

The Nifty Pharma index opened at 21,430.95 but quickly fell to an intraday low of 20,089.45. Rajesh Bhosale, an Equity Technical and Derivative Analyst at Angel One, noted that the index couldn’t sustain its morning gains, resulting in a significant sell-off. He pointed out that the volatility in this sector is high, with 20,000 serving as the next critical support level, followed closely by 19,500, the previous swing low.

Anshul Jain, Head of Research at Lakshmishree Investment and Securities, emphasized the importance of the 19,650 level, which aligns with the 20-month moving average on monthly charts. He warned that a drop below 19,600 could signal a new downtrend, potentially pushing the index into a prolonged bearish phase akin to that of the IT and FMCG sectors.

What Lies Ahead for Pharma Investors?

While traders are advised to adopt a cautious approach, holding strategy remains essential in this volatile environment. Currently, there’s potential for a short-term rebound if the support levels hold. However, sustained weakness could lead to more extensive corrections in the near future.

Summary of Key Points:

• Nifty Pharma dropped 6% following Trump’s tariff comments.
• Pharma stocks reversed previous gains from April 3.
• Key support levels to monitor are 20,000 and 19,650.
• Experts suggest a careful watch on market movements as volatility persists.

As the market navigates these changes, investors will be keenly observing how government policies and tariff structures unfold in the coming weeks. For more insights into market trends, stay updated with credible financial news sources and expert analyses.