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Why did Sensex tank more than 1500 points on the 31st of August 2020?

There are a number of reasons due to which Sharemarket has fallen today.

  1. Indo China tension in Pangong Tso Lake area which is renewing the tensions between two countries
  2. India is likely entering its deepest recession on record, which is expected to run through the second half of the fiscal year.
  3. Markets were overbought and at euphoric levels
  4. There are some confusing rules of SEBI around Pool account-liquidation and collateral account-liquidation where a lot of investors are fearing

Would the downfall continue for some more days ?

Most likely. Post-market the GDP numbers have come through. GDP for the first quarter has shrunk by about 24%, which is not a good sign. Fiscal deficit for this year is feared to be around 7% which is very high