(fxcue news) - Indian shares may open on a sluggish note Thursday after U.S. President Donald Trump announced 25 percent tariffs on auto and auto parts starting next week, ratcheting up trade tensions and heightening concerns about the path for inflation and global growth. Trump said the tariffs are "permanent" and he was not interested in negotiating any exceptions. In another significant development, Washington has placed New Delhi on the same level as Beijing in connection with the supply of precursor chemicals used by drug cartels to manufacture opioids like fentanyl. Benchmark indexes Sensex and the Nifty fell around 0.9 percent and 0.8 percent, respectively on Wednesday to snap a seven-session winning streak. The rupee gained 3 paise to close at 85.69 against the dollar supported by increased foreign fund inflows. Foreign institutional investors (FIIs) continued their buying streak for the fifth straight session, picking up shares worth Rs. 2,240.55 crore on a net basis Wednesday while domestic institutional investors turned net sellers and offloaded shares to the extent of Rs. 696.37 crore, as per provisional data. Asian stocks were mostly lower at open, though Chinese and Hong Kong markets traded in positive territory after Trump said tariffs coming in April will 'probably be more lenient than reciprocal' and that he would consider lowering tariff rates imposed on China to secure Beijing's support for a sale of the U.S. operations of ByteDance Ltd.'s social video platform TikTok to an American company. Data showed profits at China's industrial firms contracted at the start of 2025, flashing a worrying sign for the world's second-largest economy. The dollar extended gains while the Mexican Peso and the Canadian dollar slipped on tariff concerns. Gold ticked higher as Goldman Sachs and BofA raised their gold price forecasts amid trade-war tensions. Oil held a gain after a government report showed U.S. crude inventories fell the most since December. U.S. stocks snapped a three-session winning streak overnight and the dollar resumed its ascent as investors fretted about the economic impact of a tariff war. Sentiment was also dented by a warning from the Congressional Budget Office that the Treasury risks a payment default in August unless Congress raises the debt ceiling. The tech-heavy Nasdaq Composite lost 2 percent on doubts over artificial intelligence demand, while the S&P 500 shed 1.1 percent and the Dow eased 0.3 percent. European stocks fell broadly on Wednesday after a White House announcement that auto tariffs are coming. The pan European STOXX 600 dropped 0.7 percent. The German DAX tumbled 1.2 percent and France's CAC 40 gave up 1 percent while the U.K.'s FTSE 100 rose 0.3 percent as data showed inflation slowed more than expected in February.