Sensex falls 1,400 points as trade war fears rattle D-Street, Rs 9 lakh crore gone

The massacre on Dalal Street persisted on Friday as both benchmark indices dropped close to 2% each. The S&P BSE Sensex plummeted by more than 1,400 points, while the Nifty50 fell beneath 22,150. The primary cause of the current market crash was concerns over a global trade war and ongoing selling by foreign investors.

The Sensex plummeted 1,414 points (1.9%) to 73,198, while the Nifty fell 420 points (1.86%) to 22,124. It is important to mention that the devastation erased almost Rs 9 lakh crore in market worth, lowering the overall market capitalization of BSE-listed companies to Rs 384.22 lakh crore. In today’s trading session, information technology stocks suffered heavily, as Nifty IT plummeted 6.5% following a steep drop in Nvidia’s stock overnight in the US.

Prominent companies like Tech Mahindra, Wipro, and Mphasis ranked among the largest losers. Auto stocks faced a downturn as the Nifty Auto index dropped by almost 4%. Various sectors, such as banking, metals, media, FMCG, pharma, and oil & gas, declined by 0.7% to 3.5%.

Vinod Nair, Head of Research, Geojit Financial Services, “The national market experienced a sharp decline amid heightened bearish sentiment largely influenced by weak global cues. The decline was largely triggered on fear of the implementation of 25% tariff on US imports from Canada and Mexico, set to take effect next week, along with an additional 10% tariff on Chinese goods.”

“Adding to market jitters, the potential imposition of tariffs on the European Union has further fuelled uncertainty. As investors navigate this volatility, all eyes are on the domestic Q3 GDP data, which could provide vital insights into the economic recovery trajectory and influence market direction,” Nair added.

Commenting on the Nifty, Rupak De, Senior Technical Analyst at LKP Securities, said, “Nifty experienced a significant decline on Friday, shedding over 400 points after a consolidation breakdown. The RSI remains bearish but has entered the oversold zone.”

“In the near term, Nifty is expected to find support around 21,800-22,000. A sustained move above 21,800 could lead to a significant recovery, while failure to hold this level may trigger another sharp decline,” he added