Markets Plunge: Sensex Sinks 1,336 Points, Nifty Hits 9-Month Low Amid Trade War Fears
At 12:55 PM, the Sensex tumbled 1,335.93 points (1.79%) to 73,276.50, while the Nifty fell 406.10 points (1.8%) to 22,138.95. Market breadth remained weak, with 416 stocks advancing, 3,062 declining, and 80 unchanged.
The sell-off led to a massive ₹6.1 lakh crore erosion in market capitalization for BSE-listed firms on February 28, with the Nifty hitting a 9-month low. So far in February, the Nifty 50 has dropped around 5% and is on track for its fifth straight month of losses, marking its longest losing streak in 29 years.
Key Factors Behind the Market Decline:
- Trade War Fears: On February 27, US President Donald Trump announced that 25% tariffs on imports from Canada and Mexico would take effect on March 4, earlier than the previously stated April 2. Additionally, he imposed a 10% tariff on Chinese goods, escalating concerns of a trade conflict.
V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted the uncertainty triggered by Trump’s policies.
“Stock markets dislike uncertainty, and it has been rising since Trump took office. His series of tariff announcements have impacted sentiment, and the latest 10% tariff on China reinforces the view that he will use trade threats as a negotiation tactic,” Vijayakumar said.
He further noted that markets have not yet priced in a full-scale US-China trade war, though the uncertainty has intensified, as reflected in the CBOE Volatility Index (VIX) surging to 21.13. China’s response to these latest tariffs will be crucial in shaping market direction.
