Rs 19 Lakh Crore Wiped Out : India’s stock markets suffered a brutal bloodbath on Monday, as panic gripped investors across the globe. The BSE Sensex nosedived over 3,200 points and the Nifty 50 plunged 5%, erasing a massive Rs 19.4 lakh crore in market capitalisation. This marks the steepest intraday crash in recent months, echoing global selloffs and economic fears.
By 12:22 PM, the Sensex tumbled 3,219 points or 4.27%, settling at 72,145, while the Nifty50 collapsed 1,146 points to 21,758.
Across sectors, it was red everywhere:
- Nifty Metal tanked 8%
- Nifty IT fell over 7%
- Auto, Realty, Oil & Gas all dropped more than 5%
- In the broader markets, small-cap and mid-cap indices plunged 10% and 7.3% respectively
So, what triggered this stock market carnage? Here are the 6 key reasons:
1. Nasdaq Enters Bear Market Territory
To begin with, the tech-heavy Nasdaq index officially slipped into bear market territory on Friday, having dropped more than 20% from its recent peak. The sharp fall followed U.S. President Donald Trump’s surprise tariff hikes, which rattled global investors and raised fears of a deepening economic slowdown.
Further escalating worries, Federal Reserve Chair Jerome Powell warned that the tariffs were “larger than expected” and could seriously dent economic growth, stoking further uncertainty in U.S. markets.
2. Global Markets in Free Fall
India wasn’t alone. Major Asian indices tanked, mirroring the panic from Wall Street:
- Japan’s Nikkei fell 7%
- South Korea’s Kospi dropped 5%
- China’s blue-chip index lost nearly 7%
- Hong Kong’s Hang Seng collapsed over 10.5%
Meanwhile, U.S. futures extended losses—Nasdaq futures were down 4% and S&P 500 futures dropped 3.1%. Even European markets were trading deep in the red, signalling that this is a global rout, not an isolated event.
3. Recession Fears Take Centre Stage
Although inflation remains a concern, the spotlight has now shifted to recession fears. Investors are increasingly worried that rising tariffs could drive up prices, squeeze corporate profits, and slow down economic growth worldwide.
U.S. consumer price index (CPI) data due this week is expected to show a 0.3% rise in March. However, analysts fear that future price hikes across food, electronics, and automobiles could be more severe, just as earnings season kicks off in the U.S.
4. Commodity Prices Plummet
Adding fuel to the fire, global commodity prices nosedived amid expectations of weak demand:
- Brent crude dropped 6.5%
- WTI oil fell 7.4%
- Gold slid 2.4%, while silver plunged 7.3%
- Copper and aluminium lost 6.5% and 3.2% respectively
These declines reflect not just recession fears but also loss of investor confidence in global growth.
5. Flight to Safety Drains Equities
As panic spread, investors fled risky assets in favour of safe-haven instruments like U.S. Treasuries. The 10-year Treasury yield dropped 8 basis points to 3.916%, and market expectations now include a 25-basis-point rate cut by the U.S. Fed later this year.
This sharp risk-off sentiment led to massive selloffs in equity markets globally, despite Fed Chair Powell saying the central bank is “in no hurry” to adjust monetary policy.
6. Global Trade War Heats Up
Finally, the fear of a full-blown trade war intensified after China retaliated to the U.S. tariff hike by imposing its own levies on a wide range of American goods. This tit-for-tat escalation is threatening to derail global supply chains, hurt corporate earnings, and stifle global demand.
Investors fear that a prolonged trade standoff between the world’s two largest economies could lead to long-term economic instability—which is precisely what we’re seeing reflected in today’s markets.
Expert Take: “Extreme Uncertainty Is the Culprit”
“Global markets are experiencing heightened volatility driven by extreme uncertainty. No one has a clear sense of how this turbulence triggered by Trump’s tariffs will unfold. A ‘wait and watch’ approach may be the best strategy in this phase of market instability,”
— Dr. V. K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services
Bottom Line: Brace for More Volatility
With recession concerns, trade wars, and global selloffs converging at once, markets may continue to remain highly volatile in the near term. Investors are advised to stay cautious, review their portfolios, and avoid panic-driven decisions.
