Why Did the Market Crash Today?

If you opened your trading app today and saw red everywhere — no, your screen isn’t broken. The stock market just had one of its worst days in years. The Sensex crashed over 2,200 points, and the Nifty tumbled more than 740 points. So, what went wrong? Let’s break it down like a frustrated investor checking their portfolio.

1. Trump’s Tariff Tsunami

Donald Trump decided to play global economic doctor again and prescribed a fresh dose of tariffs. His “reciprocal tariffs” hit nearly every country that trades with the U.S. — including India. China immediately hit back with a 34% tariff, and suddenly we’re in a full-blown trade war.

This isn’t just politics. It’s panic. Investors hate uncertainty, and Trump just turned the volume to max.

“Markets are going through extreme uncertainty. No one knows where this ends,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

2. Recession Alert from the U.S.

Goldman Sachs increased the chances of a U.S. recession to 45%. That’s up from 35%, and it’s a huge red flag. With inflation still sticky and growth slowing, the world’s biggest economy might be heading toward a slowdown — and when the U.S. sneezes, global markets catch a cold.

3. Global Markets: A Sea of Red

India wasn’t alone in the pain. Around the world, markets were in full panic mode:

• Nikkei (Japan): Down 8%
• Kospi (South Korea): Fell 5%
• Hang Seng (Hong Kong): Crashed 10.5%
• Nasdaq futures: Slumped 5.3%
• S&P 500 futures: Down 4.2%

Everyone’s running for safety, and risk assets are being dumped.

4. Dalal Street Joins the Sell-Off

Back home, the BSE Sensex fell 2,227 points (nearly 3%) to close at 73,137. The Nifty 50 dropped 743 points, settling at 22,161. It was a total market-wide sell-off — from large-caps to midcaps to smallcaps. No one was spared.

5. Sector Carnage: Metal & Realty Crushed

Every major sector was deep in the red. Some got absolutely destroyed:

• Metal index: Down 6.7%
• Realty index: Down 5.6%
• Auto, IT, Energy, PSU Banks: Lost 3-4%

Investors dumped anything and everything that looked remotely risky.

So, What Now?

Experts are advising a “wait and watch” approach. While India’s direct exposure to U.S. tariffs is limited (only about 2% of GDP), the overall uncertainty and fear are driving investors away. The India VIX (fear index) spiked 55% — a big sign that volatility is here to stay.

But here’s the silver lining: Domestic consumption plays — think banking, aviation, hotels, cement, and even defence — might remain strong. Also, Trump hasn’t touched Indian pharma (yet), and there’s hope that India’s ongoing bilateral trade talks with the U.S. might reduce the tariff blow.

So breathe. Don’t panic sell. And maybe — just maybe — don’t open your trading app until tomorrow.

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