On February 11, 2025, the Indian stock market experienced a significant downturn, with the BSE Sensex crashing by 1,281 points (1.65%) to a low of 76,030.59, and the NSE Nifty dropping 395 points (1.68%) to 22,986.65. This slump led to a massive erosion of investor wealth, with approximately ₹9.55 lakh crore to ₹10 lakh crore being wiped out from the market.
Factors Contributing to the Market Crash:
- Trump’s Tariffs: US President Donald Trump’s decision to impose a flat 25% tariff on steel and aluminum imports, without exceptions, triggered worries about trade conflicts and inflation. The announcement of “reciprocal tariffs” on imports from countries that impose duties on US products further fueled negative market sentiment.
- Persistent FII Selling: Foreign Institutional Investors (FIIs) have been consistently selling Indian equities, intensifying the market’s decline. On February 11, FIIs sold Rs 2,463.72 crore worth of equities. NSDL data indicates that FIIs have sold Rs 78,027 crore in January and Rs 85,841 crore worth of equities so far.
- Broad-Based Selling: The downturn was widespread, affecting various sectors. The BSE Midcap and Smallcap indices also experienced significant losses, slipping over 3% each.
Sectoral Performance:
Most sectors experienced selling pressure. Nifty Realty was down over 3%, while Nifty Auto, Nifty FMCG, Nifty Pharma, Nifty Oil & Gas, and Nifty PSU Bank all fell over 2%.
Stocks Performance:
- On the Sensex, major losers included Zomato, Power Grid, Larsen & Toubro (L&T), Tata Steel, and Hindustan Unilever (HUL), with declines exceeding 2%.
- On the Nifty, Eicher Motors and Apollo Hospitals experienced significant drops of over 6%, while Shriram Finance was down over 4%.
Market Breadth:
The overall market sentiment was weak, with 411 stocks hitting their 52-week lows on the BSE. Out of the 4,018 stocks traded on the BSE, 491 were trading in the green, while 3,421 were in the red.
Expert Opinions:
- Sameet Chavan from Angel One advised investors to stay abreast of global market developments and avoid aggressive bets until there is more clarity on market trends.
- Siddhartha Khemka from Motilal Oswal noted that market attention would shift to Q3 earnings, corporate guidance, and global macros amid turbulence caused by Trump’s trade policies.
Overall, the Indian stock market faced a significant downturn due to a combination of global trade tensions, consistent selling by foreign investors, and broad-based selling across various sectors.
