Indian shares falter; tariffs on U.S. goods stoke trade war fears
By Krishna V Kurup
June 17 (Reuters) - Indian shares fell on Monday, dented by losses across sectors, after the country slapped higher tariffs on certain U.S. products in retaliation to Washington's decision to remove certain trade privileges for New Delhi.
India, the largest importer of U.S. almonds, imposed higher retaliatory tariffs on 28 U.S. products including almonds, apples and walnuts from Sunday. Total trade between the two countries stood at about $142.1 billion in 2018.
Higher Indian tariffs on U.S. goods could impact growing political and security ties between the two nations.
"India putting retaliatory tariffs on U.S. is leading to a fear that it might escalate into a trade war between the two countries," said Siddhartha Khemka, head of retail research at Motilal Oswal Securities.
"Our economy is anyway struggling in terms of growth and any additional pressure in terms of export because of this could further put pressure on the economy," he said.
The broader NSE index .NSEI fell 0.58% to 11,755.05 as of 0510 GMT, while the benchmark BSE index .BSESN declined 0.52% to 39,247.55. Only nine stocks were trading in the green on the NSE index.
Nifty energy index .NIFTYENR fell 1.4%, with Reliance Industries RELI.NS among the biggest drags. Reliance shares touched their lowest level in over four weeks, falling up to 2%.
Oil prices rose on Monday after U.S. Secretary of State Mike Pompeo said Washington will take all actions necessary to guarantee safe navigation in the Middle East, as tensions mounted following attacks on tankers last week. O/R
Nifty metal index .NIFTYMET fell 1.9%, dragged by JSW Steel Ltd JSTL.NS and Tata Steel Ltd TISC.NS. JSW Steel fell up to 3.3%, while Tata Steel shed 2.5%.
Among the losers, Jet Airways Ltd JET.NS fell over 16%. Lenders to the grounded airline will finalise the course of action for the carrier on Monday, the Economic Times reported.
Lenders will need to take a call on whether a rescue of the carrier is still possible or it will have to be taken to bankruptcy court, the paper said.
(Reporting by Krishna V Kurup in Bengaluru; editing by Gopakumar Warrier)