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Market crashes can be devastating, it sets a panic among many investors, and there is so much loss incurred that major crashes are often dubbed a ‘blood bath’. It is very tough for investors to stay put during such trying times. However, it is quite apparent, that markets do emerge out of such crashes much stronger and more resilient. 

Market lows are a reality, here are the historical stock market crashes:

The year 2020 - Year of the GREAT Pandemic COVID-19

A year we all recall as the onset of Coronavirus, there were a few market lows spruced with the fear of the devastating effect of the pandemic on the economy:

01 February 2020

Against the backdrop of the Union budget presentation and the trickling news around the Coronavirus pandemic centred in China, the Sensex fell by over 2%.

28 February 2020

Growing concerns around Coronavirus and speculation by the WHO that the infection had a pandemic potential led to a 5-day downtrend with both Sensex and Nifty. 

March 04 & 06, 2020

Sensex fell by over 1000 points on the backdrop of rising concerns around Yes Bank and the entire banking system. On 06th  March 2020, Yes Bank was brought under the RBI for reconstruction and an announcement of the subsequent merger with SBI was made *.

March 09, 12, 16 & 23, 2020

The biggest fall was recorded on 23rd March with Sensex taking a 3,934 points (13.15%) blow and Nifty plunging 1135 points (~13%) * amidst growing concerns of possible lockdown. Markets were at the lowest points since 2016. 

The year 2018 - Long term capital gain tax (LTCG) on equity, Weak global market

February 2 & 5, 2018

The proposal to introduce a 10% long term capital gains tax on equity shares sold after a holding period of 12 months was met with negative sentiment in the market. Sensex fell over 1100 and Nifty fell (considering the lowest value) by around 600 points across these 2 trading sessions.

The year 2016 - Demonetization and withdrawal of FII

February 2016

The losing streak in markets could be traced to over 4 months, with the FIIs selling over Rs. 17,318 crore is worth of equity holding. These happenings were attributed to NPAs of banks, global cues being weak, growing concerns around China’s economy and tumbling crude oil prices, which were trading at below $30 per barrel *.

09 November 2016

This market crash was around demonetisation and the Indian Government’s attempt to crack down on black money. The Sensex fell by 1689 points and the Nifty dropped by 541 points *. The markets continued to stay under stress amidst the weakening rupee and US presidential elections. The markets around the world continued to remain under stress. 

The year 2015 -  Economic Slowdown & Currency devaluation

24 August 2015

Sensex fell by 1,624.51 points, while Nifty fell by 490.95  points *, this was amidst the economic slowdown in China and currency devaluation. Growing concerns around emerging economies led to rapid selling across Chinese and Indian markets. The gloomy picture was iterated with disappointing earnings by Indian companies. 

The year 2008 - Global Financial Crisis

21 January 2008 

A deeply etched in every market participant's mind is referred to as “Black Monday”. There were raising concerns about the US economy slipping into recession. There was consistent selling by FIIs and hedge funds across emerging markets with the intent to move funds into stable economies. On this day markets fell by 1408.35 points, leading to one of the deepest wealth erosions. 

22 January 2008

• Sensex had the greatest intraday fall of 2,273 points *, however, recovered before it closed by falling by 875 points. 

• Nifty fell by 310 points and closed at 4899.3. Trading on BSE was suspended for an hour within minutes of market opening as it hit a lower circuit of 10% *.

• There was a slew of falls in the first quarter of 2008, a year that cannot be forgotten in the history of markets, but the worst was yet to come in the last quarter of the year.

• Increasing concerns about the subprime crisis in the US and possible recessionary trends led to a continued fall in the markets. 

24 October 2008

Sensex fell by 1070.63 points to close at 8701.07 points, the markets had lost over 50% of the value at which it began the year. 

26 November 2008
Markets continued to fall amidst raising concerns about large sales by FIIs and the insurance sector. 

During the start of the subprime crisis, the Nifty was trading at 6200, within 45 weeks it fell to 2500. This sharpest fall was dubbed as “…dashing middle-class dreams” by Livemint newspaper *.

Having traced these 5 crashes, it is obvious that market lows are a part of the cycle. There is no reason to fret when the markets fall sharply since this too shall pass. 

Data Source:

https://www.inventiva.co.in/business/finance/13-biggest-market-crashes/
https://tradebrains.in/stock-market-crashes-india/