New Delhi, Feb 28: The Indian stock market faced a severe jolt on Friday as the benchmark Sensex tumbled 1,414 points, wiping out ₹9 lakh crore in investor wealth. The sharp downturn was triggered by fresh tariff threats from the United States, which reignited global trade war fears, coupled with persistent foreign fund outflows.
Market Bloodbath: Sensex and Nifty Extend Losing Streak
The BSE Sensex sank 1,414.33 points (1.90%), settling at 73,198.10, after hitting an intra-day low of 73,141.27. This marked its eighth consecutive session of losses. Meanwhile, the NSE Nifty declined 420.35 points (1.86%) to close at 22,124.70.Since reaching its all-time high of 85,978.25 on September 27, 2024, the Sensex has shed 12,780.15 points (14.86%), while the Nifty has plunged 4,152.65 points (15.80%) from its peak of 26,277.35.
The broader market valuation reflected this rout, with the total market capitalisation of BSE-listed firms plunging to ₹3,84,01,411.86 crore ($4.39 trillion), down ₹9,08,798.67 crore in a single session. Compared to the September 2024 peak of ₹4,77,93,022.68 crore, investor wealth has eroded by a staggering ₹93.91 lakh crore.
Global Triggers: Trade War Fears and Economic Slowdown Concerns
Market analysts attributed the steep decline to US President Donald Trump's decision to impose a 25% tariff on imports from Canada and Mexico, effective March 4, with additional duties planned on China. This announcement exacerbated fears of escalating trade tensions, leading to a broad-based sell-off in global equities."Domestic investors went into panic mode and offloaded equities at will as weak global market cues triggered a near 2% crash in benchmark indices. Concerns over economic slowdown, below-par earnings, and relentless foreign investor selling have fueled the bearish sentiment," said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.
Sectoral Impact: Tech Mahindra, IndusInd Bank, M&M Among Top Losers
Among Sensex stocks, Tech Mahindra nosedived over 6%, followed by IndusInd Bank, which lost more than 5%. Other significant losers included Mahindra & Mahindra, Bharti Airtel, Infosys, Tata Motors, Titan, Nestle, TCS, and Maruti. HDFC Bank was the only gainer in the pack.Global Markets in Deep Red
The sell-off was not limited to Indian equities, as Asian markets—Seoul, Tokyo, Shanghai, and Hong Kong—ended with steep losses. European markets also traded lower, while Wall Street recorded a sharp decline on Thursday."This marked the longest losing streak for Nifty-50 since 1996, with five consecutive months of declines. Since September, the index has erased nearly $1 trillion in investor wealth," noted Ameya Ranadive, Sr. Technical Analyst at StoxBox.
Foreign Investors Continue to Pull Out Capital
Foreign Institutional Investors (FIIs) remained net sellers, offloading ₹556.56 crore worth of Indian equities on Thursday. Analysts noted that broader midcap and smallcap indices continued to witness sharp derating in valuations.Brent Crude Prices Drop
Adding to the market pressure, global oil benchmark Brent crude declined 1.40% to $73 per barrel, signaling concerns over weakening global demand.Market Outlook: Uncertainty Ahead
With global trade war fears resurfacing, persistent FII outflows, and weak earnings reports, analysts caution that volatility may persist in the coming sessions."Markets extended declines throughout the session as bearish sentiment gripped investors. The persistent derating in mid and smallcaps suggests a deeper correction could be underway," said Satish Chandra Aluri, Analyst, Lemonn Markets Desk.
As global uncertainties continue to weigh on investor sentiment, all eyes will be on further developments in US-China trade relations and domestic macroeconomic indicators.
