Sensex Tanks 4000 Pts, Rs 20 Lakh Crore Wiped Out — What Should Investors Do? Warren Buffett's Top 3 Advice

Stock Market Crash Today: The Indian Stock Market saw a major crash on Monday morning, with the Sensex tumbling over 3,900 points, or 5.22%, in early trade due to global market panic over rising trade war concerns.

Investors’ wealth took a major hit, falling sharply by Rs 20.16 lakh crore as the total market capitalisation of BSE-listed companies dropped to Rs 383.18 lakh crore (about USD 4.5 trillion).

All 30 Sensex stocks were in the red, with Tata Steel and Tata Motors falling over 10% each. Other major losers included Larsen & Toubro, HCL Technologies, Adani Ports, Tech Mahindra, Infosys, TCS , Reliance Industries, and M&M.

The crash was not limited to India — global markets also faced heavy losses. Hong Kong’s Hang Seng plunged over 11%, Japan’s Nikkei 225 dropped 7%, and the US markets ended last week with the S&P 500 down nearly 6%.

What Should Investors Do Now?

In such times of panic, many investors wonder what to do. One person who has weathered countless market storms is legendary investor Warren Buffett. His approach during market downturns is simple but powerful — don’t panic, and look for opportunities.

See Opportunity in Crisis: Warren Buffett

Buffett says investors should see crashes not as disasters, but as chances to buy good stocks at discounted prices.

Back in 2008, during the Great Recession, he wrote that downturns are part of the market cycle and that the time to invest is when others are fearful. “Bad news is an investor’s best friend,” he said, as it allows people to buy valuable companies at lower prices.

Also Read: Black Monday On D-Street? Sensex Crashes 4000 Points As Donald Trump’s Tariffs Create Havoc

Build Cash Reserves During Highs, Invest During Lows

Buffett also advises investors to hold cash when markets are high so they’re ready to invest when prices drop.

In fact, in late 2024, he was building a huge cash reserve of $325 billion, even as markets hit record highs. This way, he could be ready to buy strong companies when the market eventually turned.

Stick With Strong Companies: Warren Buffett

Most importantly, Buffett believes in picking strong, stable companies and holding onto them for the long term.

He famously said, “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.” This mindset helps investors avoid panic selling and trust that solid companies will recover and grow over time.