Sensex Crashes 1,000 Points, ₹9 Lakh Crore Investor Wealth Wiped Out

Indian equities reeled under intense selling pressure on Friday, with benchmark indices crashing in response to escalating global trade tensions triggered by U.S. President Donald Trump’s sweeping reciprocal tariffs. The Sensex nosedived 1,009.07 points (1.32 percent) to an intraday low of 75,286.29, while the broader NSE Nifty fell 375.7 points (1.61 percent) to 22,874.40, marking their steepest single-session drop in months. The broader sell-off erased over Rs 9 lakh crore in investor wealth, rattling traders and institutions alike.

The broader market saw even deeper losses, with both the Nifty Midcap 100 and Nifty Smallcap 100 indices tanking more than 3 percent intraday. Market breadth was heavily skewed towards decliners, with 2,496 shares falling, only 834 advancing, and 116 unchanged. Key sectors such as IT, pharma, and metals witnessed a broad-based capitulation, underscoring the severity of sentiment deterioration.

Trump Tariffs Ignite Fears of Recession, Prompt Broad-Based Meltdown

The catalyst behind Friday’s rout was Trump’s announcement of a 26 percent “discounted reciprocal tariff” on Indian goods, positioned as a retaliatory measure against what he termed India’s “very, very tough” trade policies. The latest measures are part of a broader escalation targeting over 60 countries, including key allies and trade partners.

The tariff declaration has sparked immediate backlash from countries like Canada and China, which are preparing retaliatory duties of their own. Analysts fear a prolonged and expanding trade war may push the global economy toward recession, with financial markets reflecting the anxiety.

Devarsh Vakil, Head of Prime Research at HDFC Securities, commented: “Wall Street benchmarks slumped on Thursday, logging one of the steepest single-day percentage declines in years. President Trump’s aggressive tariff push has raised the spectre of a full-blown trade war and possible global recession.”

Overnight, the S&P 500 plummeted 4.9 percent while the Nasdaq 100 collapsed 5.5 percent, erasing $2.5 trillion in U.S. market capitalisation. Asian indices followed suit, with Tokyo’s Nikkei tumbling over 3 percent and South Korea’s KOSPI slipping nearly 2 percent. Markets in Shanghai and Hong Kong were shut for the Qingming festival, temporarily escaping the initial shockwaves.

Highlights:

• Trump levies 26% tariff on Indian exports, citing trade imbalance

• Policy affects over 60 nations; retaliatory actions from China, Canada expected

• $2.5 trillion wiped off U.S. markets, triggering panic in global equities

• India’s investor wealth shrinks by over Rs 9 lakh crore in a single session

Sectoral Carnage: Pharma, IT, Metals Deep in the Red

All 13 major NSE sectoral indices ended in the red, with IT, pharma, and metals witnessing the most significant declines. The Nifty IT index crashed over 3 percent, led by Coforge and Persistent Systems, as Indian tech exporters face heightened uncertainty from a weakening global demand outlook.

Metal counters such as Tata Steel, Hindalco, Nalco, Vedanta, and JSW Steel lost between 4 and 7 percent, amid concerns that the new trade barriers will curb demand for industrial metals and lead to supply chain disruptions.

The pharmaceutical sector suffered after Trump hinted at a new category of tariffs specifically targeting drug imports. “We are looking at pharma as a separate category — we will be announcing that sometime in the near future,” he stated, sparking fears about India’s export-heavy pharma sector.

Highlights:

• IT index down over 3% as global tech rout drags Indian software exporters

• Metal stocks plunge up to 7% on industrial slowdown fears

• Pharma under pressure after Trump threatens new tariffs on drug imports

• Tata Steel, Hindalco, Cipla, Tata Motors among top Nifty laggards

Broader Markets Sink; Midcap and Smallcap Indexes Erase Two-Day Gains

The pain extended well beyond large-cap benchmarks. Mid- and small-cap indices bore the brunt of the sell-off, with the Nifty Midcap 100 losing over 3 percent and the Smallcap 100 dropping 3.58 percent intraday. This marked a sharp reversal after a modest two-day rally, reflecting the vulnerability of smaller companies in times of global uncertainty.

Laurus Labs, Bharat Forge, and other high-beta names were among the worst performers in the broader market. Bharat Forge, which has exposure to the U.S. auto and commercial vehicle space, fell sharply in response to fresh Canadian tariffs on American cars—a potential ripple effect that could reduce demand for its components.

Meanwhile, Gensol Engineering continued its stunning fall, hitting the lower circuit for the second consecutive day. The stock has now lost 62 percent of its value over the past month, with investor confidence severely shaken.

Highlights:

• Mid- and small-cap stocks down 3–3.5%; gains from earlier this week erased

• Bharat Forge, Laurus Labs among notable losers

• Gensol Engineering hits lower circuit, extends monthly decline to 62%

• Sentiment in midcap space remains extremely fragile

Technical Breakdown: Crucial Support Levels Breached as Panic Grips Market

The dramatic plunge below 23,000 on the Nifty and 75,300 on the Sensex signals a breakdown of critical technical supports. Analysts now warn of a prolonged period of volatility unless clear signals of economic stability emerge. According to chartists, the next support zones lie near 22,750 for Nifty and 74,800 for Sensex.

Shrikant Chouhan of Kotak Securities stated, “There is very little buying interest even near key support levels. If global pressures persist, the Nifty could test 22,500 in the coming days. A rebound above 23,200 would require strong volumes, which are currently missing.”

Market participants are advised to exercise caution, particularly with leveraged trades, and watch for signals from central banks or government interventions.

Highlights:

• Nifty drops below 22,900; Sensex hits 75,286 intraday

• Support zones now seen at 22,750 (Nifty) and 74,800 (Sensex)

• Technical rebound unlikely without buying momentum

• Traders urged to stay cautious amid high volatility

Global Fragility Adds to Investor Anxiety

The global picture continues to deteriorate, with no signs of a reversal in sentiment. The Qingming festival closure of China and Hong Kong markets has delayed the full-scale reaction from the region, but traders anticipate a sharp correction when these exchanges reopen. Meanwhile, geopolitical tensions and fragile economic data are keeping risk appetite low across the board.

Investors are also keeping a close eye on the upcoming U.S. Federal Reserve speech by Jerome Powell, and the Reserve Bank of India’s Monetary Policy Committee (MPC) meeting next week. These events are now seen as critical catalysts for any potential market stabilisation.

Highlights:

• Asian markets down sharply; China, Hong Kong yet to reopen

• Global sentiment remains fragile amid policy uncertainty

• RBI MPC meeting, Powell’s speech eyed for possible support signals

• Recession concerns now front and center in investor outlook