Bloodbath On D-Street. Sensex plunges over 750 points; Nifty below 22,900. Stock Market Predictions By 3 Market Gurus For FY25, Brace For A Crash!

If you’ve been keeping an eye on the markets today, you might have winced at the carnage. Indian benchmark indices, the Sensex and Nifty50, are having a rough day, and calling it a bloodbath would be an understatement. For the second straight session, the markets have tanked, dragging investors’ wealth along with them.

Let’s break down what’s happening and why this could be the tip of the iceberg.

What Happened Today?

As of 11:03 AM, the BSE Sensex had plummeted 763 points (1%), settling at 75,434. The Nifty50 wasn’t faring any better, down 240 points (1.04%), trading at 22,851.

The market capitalization of all listed companies on the BSE? It’s taken a massive hit, dropping by Rs 9.48 lakh crore to a current valuation of Rs 410.03 lakh crore. Investors, it’s time to take stock of what’s causing this turbulence.

1) US Policy Uncertainty. The Tariff Turmoil

Leave it to Donald Trump to shake things up. The U.S. president announced a plan to impose 25% tariffs and sanctions on Colombia after a diplomatic scuffle over deported migrants. Colombia’s refusal to let two U.S. military planes land triggered this aggressive stance. While a last-minute agreement saved Colombia from these tariffs, Trump’s move to target Canada and Mexico with similar policies starting February 1st has left global markets rattled.

The constant flip-flop on policies and threats of tariffs are giving global investors serious whiplash. Such unpredictability, especially when it involves key trading partners, is a recipe for market panic.

2) Fed Rate Decision Jitters

All eyes are on the U.S. Federal Reserve’s upcoming rate decision this Wednesday. While the consensus expects the Fed to maintain the status quo on interest rates, investors are more interested in what they’ll say about the future. Will there be a rate hike? Will they lower borrowing costs as Trump demands?

Uncertainty around the Fed’s commentary is keeping investors on edge, and until there’s clarity, markets will continue to waver.

3) Weak Corporate Earnings. A Red Flag

Let’s talk numbers. The earnings season has started on a somber note. Bloomberg consensus estimates suggest that Nifty50 companies are projected to see just a 3% year-on-year (YoY) growth in earnings per share (EPS) for Q3.

Here’s the breakdown –

Winners: Capital goods, healthcare, and telecom sectors are expected to shine with high double-digit profit growth.

Losers: Metals, chemicals, consumer staples, banks, and oil & gas sectors are struggling, dragging overall earnings down.

4) Continued FIIs Selling

Persistent selling by foreign institutional investors (FIIs) remains a significant drag on the Indian stock market. As of January 24, 2025, FIIs have offloaded equities worth a staggering Rs 64,156 crore, showing no signs of letting up. This relentless selling spree has created a cloud of uncertainty over market stability.

5) Dollar Strength

Fears of additional tariffs on major U.S. trading partners, including China, Mexico, and Canada, have fueled nervousness across global markets. Despite these concerns, Nomura strategist Naka Matsuzawa predicts that the dollar’s strength amid tariff anxieties will be short-lived.

The dollar index, which measures the greenback’s performance against a basket of six major world currencies, rose by 0.21%, reaching 107.66. This spike highlights the current global unease and its ripple effects on currency markets.

Who All Have Predicted The Stock Market Crash In 2025?

Adding to the current market woes, it has to be said that perhaps the gloom-doom has been raised by some prominent market names even as the year has just started, lets take a look at what they have said –

Biggest Stock Market Crash Coming in February

1) Robert Kiyosaki, the acclaimed author of Rich Dad Poor Dad, has made a striking prediction –  the “biggest stock market crash in history” is set to occur in February 2025. This bold claim, shared via a recent tweet, has sparked widespread discussion among investors and analysts alike.

According to Kiyosaki, the anticipated crash will disrupt traditional investment markets but also create a massive opportunity for those prepared to act swiftly. He sees this downturn as a moment when “everything goes on sale,” pointing out that assets like cars and houses could become more affordable during the market collapse.

In his 2013 book Rich Dad’s Prophecy, Kiyosaki warned of a monumental stock market crash that would overshadow previous economic downturns. His latest forecast suggests that this prophecy is nearing fulfillment. Yet, Kiyosaki’s outlook is far from grim. Instead, he views the impending crash as a golden opportunity to shift focus toward alternative investments, particularly Bitcoin.

Bitcoin. The Safe Haven?

Kiyosaki predicts that capital fleeing the stock and bond markets will flow into alternative assets like Bitcoin, driving “explosive growth” in the cryptocurrency sector. He describes Bitcoin’s trajectory as “boom, boom, boom,” positioning it as a safer and more profitable option amid traditional market instability.

A long-time advocate for Bitcoin, gold, and silver, Kiyosaki advises investors to “get out of fake” assets and transition to crypto. He emphasizes that even a minimal investment in Bitcoin—such as one Satoshi, the smallest unit of Bitcoin—could yield significant returns during the anticipated crash.

2) Harry Dent. Warning of a Catastrophic Market Collapse

Harry Dent, the esteemed economist and founder of HS Dent Investment Management, has issued a dire warning about an impending global stock market collapse of unprecedented proportions.

The 71-year-old financial guru, renowned for his bold economic forecasts, suggests that the financial world may soon face a disaster of historic magnitude.

In a recent interview, Dent drew comparisons to the 2008 market crash but outlined the unique dynamics of the current economic trajectory. Unlike the natural economic bubbles of the past, such as the 1920s, Dent pointed out that today’s situation is driven by artificial stimuli, creating an extraordinary and precarious financial scenario.

Dent also indicated the extended duration of the ongoing bubble, which has persisted for over 14 years—far exceeding the typical lifespan of economic bubbles. This prolonged inflation, he argues, could make the forthcoming crash even more severe.

His forecast predicts a dramatic fallout, with potential declines of up to 86% in the S&P 500 and 92% in the Nasdaq by 2025. Even market giants like Nvidia may not escape unscathed, as Dent suggested that even top-performing stocks could experience drastic downturns, with Nvidia possibly seeing declines as steep as 98%. Despite recognizing the inherent quality of such companies, he warned investors to brace for the potential devastation.

3) Warren Buffett. A Sage Approach to a Bubble Zone

Warren Buffett, one of the most celebrated investors in the world, has also weighed in on the potential challenges awaiting the stock market in 2025. Known for his simple yet effective investment philosophies, Buffett’s insights often serve as a guiding light for market participants.

Buffett has cautioned that the stock market might enter a “bubble zone” in 2025. To steer this uncertain period, he advises prioritizing investments in stable, well-established businesses rather than succumbing to the allure of speculative stocks. While speculative investments can be tempting, Buffett emphasized that losses in these stocks could be magnified even in a relatively stable market environment.

A staunch advocate of straightforward investing, Buffett recommends sticking to what you know. For 2025, he suggests steering clear of heavy investments in speculative individual stocks. Instead, he champions broad-based index funds as a prudent choice for core investments. The S&P 500 index fund, in particular, is highlighted as an excellent option for those seeking stability and long-term growth.

Buffett’s timeless advice to investors is the importance of disciplined and informed decision-making, especially during periods of market turbulence.

What Should Investors Do?

• Diversify Your Portfolio: Spread your investments across sectors and asset classes to mitigate risk.

• Keep Cash Ready: Market dips can be an opportunity to buy quality stocks at lower prices.

• Stay Updated: Keep a close watch on Fed announcements, corporate earnings, and global geopolitical developments.

The Last Bit

Today’s Sensex crash indicate how global and domestic factors intertwine to create chaos on D-Street. While it’s tempting to panic, this is also a time for prudence and patience. February and perhaps later storm might be brewing, but with the right strategies, you can weather it and emerge stronger.

Keep calm, stay informed, and remember—the market’s volatility is as much an opportunity as it is a challenge.