Stock market crash: The Indian stock market continues to be under FIIs’ selling pressure, as they sold Indian stocks worth ₹7,536 crore on Friday. Even though DIIs bought shares worth ₹12,293 crore in the last session of February, they failed to change FIIs’ trade pattern. Finally, FIIs finished as net sellers in February, by selling shares worth ₹6,640 crore in cash. This is the eighth straight month when FIIs have ended as net sellers in the cash segment. They have been selling since July 2025.
Bank of Japan’s interest rate decision
According to stock market experts, the trend is expected to worsen further as the US economy comes under inflationary pressure from the Central Bank of Japan’s interest rate hike. They said that after a 17-year gap, the Central Bank of Japan decided to abandon the negative interest rate regime and raise interest rates to 2.50%. This is expected to create demand for Japanese treasury bonds and to end the cash carry system for FIIs. Now, the cost of funding for FIIs is expected to rise, while the availability of funds is expected to decline. So, the Bank of Japan’s next meeting (scheduled for March 18 – 19) is in the spotlight for both bulls and bears in global markets.
Experts also maintained that a rise in demand for Japanese treasury bonds would put pressure on US treasury bonds, leading to a weaker U.S. dollar and higher US inflation. These developments are expected to put pressure on the US stock market, and the Indian market won’t remain insulated. They said the US economy is on the verge of another recession, and the Nifty 50 index may reach 15,000 by the end of 2027.
On the economic challenges that global markets, including the Indian stock market, are facing these days, Sugandha Sachdeva, Founder of SS WealthStreet, said, “Elevated borrowing needs, persistent fiscal deficits, and concerns over long-term debt sustainability are limiting governments’ capacity to deploy large-scale stimulus should growth deteriorate further.”
The SS WealthStreet expert said that a combination of geopolitical uncertainty, trade policy volatility, AI-led labour disruption, and constrained fiscal flexibility suggests the global economy is navigating a structural adjustment period marked by slower trade flows, cautious investment, and moderated consumption — a synchronised cooling rather than a dramatic downturn, but one that warrants close monitoring.
Looming economic recession in the US
Speaking on the status of the US economy, Amit Goel, Chief Global Strategist at PACE 360, said, “The US economy is in a fragile resilience state, where a low rate of hire is not allowing the rate of fire to go upward. In other words, job losses in the US economy are being checked by lower hiring rates. This is happening due to the Bank of Japan’s interest rate decision. After a gap of 17 years, the Japanese Central Bank has announced to increase its interest rates up to 2.50%. Hence, investors are waiting for the Japan Central Bank interest rate to come around 2.50%, with a surplus amount.”
Amit Goel said that investors are waiting for a further rise in the Bank of Japan’s interest rate before buying Japan’s treasury bonds. Hence, demand for U.S. Treasury bonds dips, putting pressure on the U.S. dollar (USD) and preventing the U.S. Fed from containing inflation below 2%. In fact, this has led to a new kind of pressure on the US economy — rising US debt, which is already around $38 trillion. Due to this debt, the US has to pay $1 trillion in interest every year.
Global economic conditions
Speaking on the global economic condition, Sugandha Sachdeva said that the global economy is increasingly showing signs of a late-cycle slowdown rather than an outright recession, yet the underlying fragility across major regions is becoming more evident. The post-pandemic stimulus-driven expansion appears to be transitioning into a productivity-led, but uneven, growth phase, where gains are concentrated in select technology- and automation-driven sectors while broader demand momentum softens.
“Bond markets are signalling cautious growth expectations through stable but defensive yield behaviour, and equity markets reflect volatility rooted in uncertainty rather than systemic panic, pointing to a gradual deceleration rather than a sharp collapse,” Sugandha added.
Indian economic condition
Expecting the US economic crisis to hit the Indian economy by the end of 2026, Amit Goel of PACE 360 said, “The fragility of the US economy’s resilience is expected to weigh on India by October to November 2026. The reason is India’s household debt reaching 70% of GDP, and earnings per share nosediving by around 50%. So, the upcoming economic crisis may turn into a depression, as large job losses are also expected. As the IT and tech sector would be the biggest casualty, the economic crisis would last for a long time, maybe for two or two and a half years.”
Market experts predicted that the next two years would be highly challenging for the equities market and advised investors to consider safe-haven assets.
Can Nifty 50 touch 15,000 by the end of 2027?
Expecting a big drop in the Indian stock market, Amit Goel of PACE 360 said, “The Nifty 50 is expected to go below 21,000 by the end of the current year. The 50-stock index would continue to fall next year, with some dead-cat bounces. By the end of 2027, the Nifty 50 index is expected to come around 15,000.”
The PACE 360 expert said that 24,600 and 24,000 are two immediate and crucial supports for the key benchmark index. If the 50-stock index falls below this support, it would likely test the next major support at 22,100 to 22,000. He said the Nifty 50 index would reach these levels after some dead-cat bounces.
The Nifty 50 saw sharp gains after the India-US trade deal was announced, but failed to hold on to those gains and has since been range-bound.
Rohit Srivastava, Founder & Global Strategist at indiacharts.com, believes the market may remain under pressure at higher levels if the index fails to break its all-time high.
“The top made in January was an important one, and failure to surpass it means that the market may continue to remain under pressure at higher levels. An ending diagonal pattern during the last quarter of 2025 marks an important stock market top for the coming year,” said Srivastava.
In an earlier interview with LiveMint, Rohit Srivastava of indiacharts.com also predicted that the Nifty 50 could reach 19,000 by the end of this year due to global headwinds.
Looming threat of US-Iran war as Israel attacks Iran today
“Geopolitical risks remain a key overhang. Escalating tensions in the Middle East pose material risks to global energy stability. Any disruption or blockage of the Strait of Hormuz, through which nearly 20% of global oil supply transits, could trigger a sharp spike in crude prices, push freight and logistics costs higher, and re-ignite inflationary pressures worldwide, said Sugandha of SS WealthStreet.
The SS WealthStreet expert said that such a scenario would complicate central bank policy, forcing a delicate balance between inflation control and growth support. At the same time, global trade remains vulnerable to policy uncertainty. Ongoing tariff-related developments in the U.S., including legal challenges and potential reversals, have created ambiguity for supply-chain planning and fiscal revenues. If tariff collections decline while trade deficits remain elevated, fiscal pressures could intensify.
Is AI adoption adding complexity?
Highlighting the structural shift in the AI adoption, Sugandha Sachdeva said, “AI adoption is adding another layer of complexity. While automation and artificial intelligence are enhancing productivity and long-term efficiency, they are also accelerating labour market recalibration.”
Sugandha said that hiring momentum in white-collar and technology segments has moderated as corporations increasingly prioritise cost optimisation and automation over workforce expansion. This transitional phase of job churn and potential layoffs risks dampening wage growth, consumer confidence, and aggregate demand in the near term, even if productivity gains materialise over time.
US-Iran war buzz: Israel attacks Iran
Israel launched a pre-emptive attack against Iran on Saturday, and a United States attack is underway, plunging the Middle East into a renewed military confrontation and further dimming hopes for a diplomatic solution to Tehran’s nuclear dispute with the West.
According to Reuters, the U.S. military initiated a series of strikes against targets in Iran, two U.S. officials told Reuters, speaking on condition of anonymity. The scope of the air and sea operations was not immediately clear. Iran was preparing a crushing retaliation, an Iranian official told Reuters.
A source told Reuters that Iran’s supreme leader, Ayatollah Ali Khamenei, was not in Tehran and had been transferred to a secure location.
Where to invest?
Advising investors to look at safe-haven assets in the upcoming two years, Amit Goel said, “One should accumulate long-term government bonds before the end of the current financial year and hold it for the next two years, until the global slowdown subsides.”
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
