The report discusses a significant decline in the Indian stock market on February 28, detailing the reasons behind the crash and its potential consequences. Below is a clear and structured breakdown of the report: Market Crash on February 28 Sensex dropped 1,420 points to close at 7,312. Nifty fell 418 points to close at 22,126. This sharp decline led to a massive loss in market capitalization of companies listed on the BSE. New record: Nifty has now closed in the red for five consecutive months, a trend not seen since 1996. Five Major Reasons Behind the Market Crash 1. Fear of a Global Trade War US President Donald Trump announced a 25% tariff on goods from Canada and Mexico, effective March 4. Additionally, a 10% extra tariff was imposed on Chinese imports. This created uncertainty in global markets, as a trade war between major economies could negatively impact global trade. Market expert VK Vijay Kumar stated that stock markets dislike uncertainty, which has been increasing since Trump took office. 2. Weakness in Asian Stock Markets Major Asian stock markets saw significant declines: Hong Kong’s Hang Seng Index fell 2.3%, breaking a six-week rally. China’s CSI 300 Index declined 0.8%. Shanghai Composite Index fell 0.9%. Japan’s stock markets faced the biggest foreign investor sell-off in five months, with over $1 trillion in withdrawals. This global sell-off affected investor sentiment in India, leading to panic selling among retail investors. 3. Doubts About AI Sector Growth AI industry leader Adiya reported weaker-than-expected quarterly results, causing global tech stock declines. Adiya’s stock price crashed 85% overnight. A Chinese competitor (Dips Company) has introduced advanced AI models using cheap chips, challenging industry leaders. Investors lost confidence in the AI sector’s growth potential, contributing to market instability. 4. Concerns About a US Economic Slowdown The US reported a sharp rise in weekly unemployment claims, raising fears of an economic slowdown. Inflation concerns were already rising due to Trump’s tariffs. IT stocks, which rely heavily on the US market, fell sharply: Nifty IT Index dropped 4% today. IT stocks have fallen 8% this week, compared to Nifty 50’s 2% drop. 5. Foreign Investors Prefer China Over India China’s stock market is currently cheaper than India’s, making it more attractive to foreign institutional investors (FIIs). The Chinese government recently announced economic reforms, boosting investor confidence. As a result, FIIs withdrew money from Indian markets and shifted their investments to China. Expert Opinions & Future Outlook VK Vijay Kumar stated that market stability is unlikely until Trump’s tariff policies are settled. However, he noted that after such a long period of decline, large-cap stocks have become more attractively valued. Aggressive foreign selling might reduce in the coming months. India’s long-term outlook remains strong, and investors should consider accumulating quality large-cap stocks at reasonable prices. Final Thoughts The Indian stock market crash on February 28 was driven by global trade war fears, weakness in Asian markets, AI sector concerns, US economic slowdown, and foreign investor withdrawals. While the short-term outlook is uncertain, long-term investors may find opportunities in large-cap stocks.