Synopsis: Dalal Street witnessed a massive sell-off on February 24, 2026, with the Sensex crashing over 1,000 points and the Nifty50 diving nearly 1.2%. A combination of aggressive new tariff threats from the US, a vertical slide in IT stocks due to AI disruption fears, and rising geopolitical tensions in the Middle East wiped out over ₹4 lakh crore of investor wealth in a single session.
Indian Stock Market Crash February 2026
The Indian equity markets faced a “risk-off” environment today as benchmark indices snapped their recent recovery. The BSE Sensex touched an intraday low of 82,269, while the Nifty50 struggled to hold the 25,450 level.
The breadth of the market remained heavily tilted toward the bears, with mid-cap and small-cap indices also dropping up to 1%.
1. The AI “Panic” in IT Stocks
The biggest sectoral drag today was the Nifty IT index, which plummeted nearly 4%. The trigger was a global tech rout led by a 13% crash in IBM shares overnight.
This follows news from AI startup Anthropic, which claimed its new “Claude Code” tool can automate the modernization of COBOL-based legacy systems.
- The Fear: Investors worry that this could cannibalize the high-margin “maintenance and migration” revenue that Indian IT giants like TCS, Infosys, and HCLTech rely on.
- The Impact: Shares of Tech Mahindra, HCLTech, and Infosys emerged as the top Nifty losers, falling between 4% and 6%.
2. Trump’s New 15% Tariff Warning
Market sentiment was further soured by fresh trade volatility. US President Donald Trump signaled a tougher stance on Truth Social, suggesting a 15% universal tariff under Section 122 of the Trade Act of 1974.
This comes as a direct challenge to the recent US Supreme Court ruling that struck down earlier tariff measures, reigniting fears of a prolonged global trade war.
3. Rising US-Iran Tensions
Geopolitical risks intensified as reports of spreading protests in Iran and a violent government response led to threats of military action from the US. With critical nuclear talks scheduled for February 26, investors are moving capital into safe-haven assets.
This uncertainty pushed Brent crude prices above the $72 per barrel mark, a negative sign for oil-importing nations like India.
Also read: IDFC First Bank Probes Suspected ₹590 Crore Fraud in Government Accounts
4. Strengthening US Dollar and Rupee Weakness
The US Dollar Index edged closer to the 98 mark, causing the Indian Rupee to slip to 90.95 against the greenback. A stronger dollar typically triggers outflows from emerging markets as foreign institutional investors (FIIs) seek better risk-adjusted returns in US treasuries.
5. Profit Booking and Expiry Volatility
Following a minor rally last week, many institutional players chose to book profits at higher valuations. Additionally, the lead-up to the February monthly F&O expiry has introduced heightened intraday volatility, triggering “stop-loss” hunts across major banking and auto counters.
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