Retailers wary as stock rout could hit consumer outlook

Consumer firms warn market losses may push consumers to curb discretionary purchases

- Suneera Tandon

The stock market crash earlier this week and the ongoing volatility could hurt consumer sentiment, retailers have warned, as customers feeling poorer on account of the falling value of their share portfolios may cut back on discretionary spending.

US President Donald Trump's sweeping import taxes on all its trading partners, including India, have sparked concerns of a global recession, prompting investors to dump shares and cut their losses. These sharp, sudden cuts could be unnerving for a significant number of young investors, who began investing in stocks post-pandemic and who have since seen the markets move just one way - up.

There has been a surge in the number of investors in India between 2019 and 2024. The number of demat accounts (which are essential for holding shares electronically) more than quadrupled to 185.3 million in 2024, from 39.3 million in 2019.