*

Trade war and U.S. recession fears push benchmarks to

worst

session in 10 months

*

Mid- and small-caps down 20% and 23.6% from all-time highs

*

About 87% of NSE-listed stocks decline

(Updates paragraphs 3-6 to add market capitalisation, flows and

a chart)

By Bharath Rajeswaran and Shubham Batra

April 7 (Reuters) - India's stock benchmarks clocked

their worst session in 10 months on Monday as a selloff fueled

by U.S. tariffs intensified and investors dumped riskier assets

on growing fears of a global recession.

The Nifty 50 lost 3.24% to 22,161.1 and the BSE

Sensex fell 2.95% to 73,137.9. Both benchmarks posted

their biggest single-day declines since June 4, 2024.

Since the U.S. tariff announcement on April 2, the total

market value of all NSE-listed companies has fallen by $280

billion in three sessions.

"Indian markets are unable to quantify the uncertainty

unleashed by tariff war," said Nilesh Shah, managing director at

Kotak Mahindra Asset Management.

"The unfolding events will likely keep sellers on an

aggressive sell mode and buyers on a reluctant buy mode."

Foreign institutional investors sold Indian shares worth

$1.05 billion on Monday, the highest daily outflow since

February 28. Meanwhile, domestic institutional investors bought

$1.41 billion of shares.

Other global markets slumped, with the MSCI Asia ex-Japan

index losing 8.3%. Japan's Nikkei 225

dropped 7.8%, while European stocks plunged with Germany's Dax

falling 5.3% and the British FTSE shedding 4.1%.

President Donald Trump's new tariffs are "larger than

expected" and are likely to impact inflation and growth, Federal

Reserve Chair Jerome Powell said on Friday, flagging an

uncertain outlook for the U.S. economy.

S&P 500 futures slid nearly 5% in volatile trade on

Monday, while Nasdaq futures dived 5.7%, adding to last

week's almost $6 trillion in U.S. equity market losses.

The Nifty volatility index - or the fear index -

rose 66% to 22.79, the biggest daily rise in 10 years. It

touched the highest level since June 5, 2024.

While multiple brokerages such as Goldman Sachs and

Bernstein expect the tariffs to hurt India's fiscal year 2026

GDP growth, government officials said on Monday they do not see

any impact at the moment.

All 13 major sectors declined on the day.

IT companies, which earn a significant share of

their revenue from the U.S., lost 2.5%.

With tariffs and trade wars, some of the discretionary

spending in IT could get pushed out, triggering a fall in the

sector, Shibani Kurian, senior fund manager and head of equity

research at Kotak Mutual Fund, said on the Reuters Trading India

chatroom.

Metals dropped 6.75%, while financials

shed 3.5%.

Private lenders HDFC Bank, ICICI Bank

and oil-to-telecom conglomerate Reliance Industries -

the three heaviest stocks that have a 32% weightage in the Nifty

50 - lost about 3.5% each.

The broader small-caps and mid-caps

fell 3.9% and 3.6%, respectively, their worst

session in nearly three months.

($1 = 85.8200 Indian rupees)