Sensex Crashes Over 3,300 Points Amid Global Sell-Off; Rs 16 Lakh Crore Investor Wealth Wiped Out on Tariff Tensions and Recession Fears

Investments Indian Investments

Posted by NewAdmin on 2025-04-07 08:45:09 |

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Equity markets in India experienced a severe sell-off on April 7, as global economic uncertainty and escalating trade tensions triggered widespread panic among investors. The benchmark indices, Sensex and Nifty, plunged sharply during early trading, with the Sensex falling by 3,939.68 points or 5.22 percent to an intraday low of 71,425.01. The Nifty followed suit, dropping 1,160.80 points or 5 percent to 21,743.65. This marked the sharpest single-day decline since June 4, 2024, and the worst market opening since the height of the COVID-19 crisis in March 2020. The massive fall led to a staggering erosion of Rs 16.19 lakh crore in investor wealth within just a few hours.

The sharp decline came in the wake of US President Donald Trump’s announcement of another round of sweeping tariff hikes. These measures, targeting global trading partners, prompted China to impose its own set of retaliatory tariffs, which intensified fears of a full-blown trade war. Trump's comments downplaying the market's reaction added to the uncertainty, while China's 34 percent reciprocal tariff on all US imports starting April 10 further worsened the global sentiment. This escalation in tariff tensions has significantly heightened recession fears across major economies.

Market experts are increasingly concerned about the global economic outlook. Goldman Sachs revised its probability of a US recession to 45 percent, while JPMorgan Chase warned that the US might enter a recession as early as this year. Asian markets mirrored the carnage on Wall Street, with Hong Kong’s Hang Seng falling nearly 11 percent and Japan’s Nikkei 225 dropping 7 percent. Other key indices in South Korea and China also posted steep losses.

Back home, all 30 Sensex constituents were in the red, with metal, auto, and IT stocks among the worst hit. Tata Steel and Tata Motors fell over 10 and 9 percent respectively, while tech giants such as Infosys, TCS, and HCL Tech also witnessed heavy selling. The volatility index, India VIX, surged 57 percent to 21.62, indicating heightened fear and risk in the market.

Technically, analysts noted that the breach of the key 21,800 level on the Nifty suggested deeper weakness. With the index moving from +2 to -2 standard deviation within 10 days, market watchers believe that the recovery path will depend largely on the market’s behavior in the coming sessions.

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