Trump’s Pharma Tariff Shock Sends Ripples; Indian Stocks Hold Steady At Open

India’s equity markets are set to open largely flat on September 26, 2025, with investors adopting a cautious stance amid fresh concerns over US tariffs on branded pharmaceutical products. The announcement by US President Donald Trump of a 100% tariff on branded and patented drugs from October 1 has put spotlight on pharmaceutical stocks, which are expected to witness heightened volatility.

Market Opening And Sentiment Overview

Nifty futures indicate a largely stable open near the previous close levels, with Nifty 50 expected to start around 24,890 points, reflecting cautious investor sentiment.

The BSE Sensex is also anticipated to see limited movement, with global cues from weak US stock market closures weighing on sentiment.

Foreign institutional investors (FIIs) continue their mixed activity, with recent large sell-offs partially offset by domestic institutional investor purchases.

Pharmaceutical Sector Under the Lens

Indian pharma stocks are particularly vulnerable as the US market accounts for over one-third of India’s pharmaceutical exports, primarily generics and branded drugs.

Key companies like Sun Pharma, Dr. Reddy’s, Lupin, and Aurobindo face uncertainty due to the potential impact of the tariffs on branded drug imports.

Some pharma entities with existing or under-construction US manufacturing facilities, such as Biocon, may be less impacted due to tariff exemption clauses.

Analysts highlight concerns about a negative short- to medium-term impact on pharmaceutical stocks due to tariffs, although the overall impact depends on clarity around exemptions for essential and chronic medicines.

Broader Market Context

The cautious opening reflects a broader risk-off mood influenced by US economic data and fears over escalating trade tensions.

Asian markets also show declines amid the tariff concerns, adding to the subdued tone in Indian equities.

Despite short-term pressures, India's long-term growth story remains intact with potential buying opportunities in quality stocks at favorable valuations.

Sources: Reuters, NDTV, Economic Times, Bloomberg, Hindustan Times