New Delhi: India’s stock markets on Monday saw their biggest ever one-day sell-off, as investors turned nervous following decisions taken by several state governments to enter a state of lockdown.
The Sensex ended down 3,934 points, at 25,981, while the Nifty fell 13% to 7,510.
With today’s fall, investors lost Rs 13.88 lakh crore wealth while in the last month investors have lost Rs 56.22 lakh crore.
Among sectoral indices on the NSE, rate-sensitive stocks took the biggest knock with the Nifty Private Bank index plunging over 17% to 9,030 levels. Axis Bank was the biggest loser on the index – down 28% at Rs 310 apiece. Nifty Bank slipped over 16% or 3,299 points to end at 17,018 while Nifty Auto plunged over 14% or 761 points to 4,609 levels.
Over the last three days, the threat of more novel coronavirus cases has sent several states into lockdown, closing most private establishments and manufacturing plants. As of today, India had registered over 400 cases of coronavirus.
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Market regulator SEBI last week announced measures to curb excessive market volatility amid global fears, but it appears to have not had much of an effect.
“With the spread of Covid-19 continuing unabated and the fears of global recession increasing, the Indian markets crashed. The markets closed much lower in percentage terms compared to the Asian and European markets, which indicated increased uncertainty regarding the spread of the virus in India after the government indicated that the country was in a crucial phase in its fight against the virus,” said Vinod Nair, Head of Research at Geojit Financial Services.
“Further measures and lockdowns are expected after manufacturing companies indicated that they would shut down their facilities, which would have an overall impact on business activity and market confidence,” Nair added.
Global markets
Asian shares sank on Monday as a rising tide of national lockdowns threatened to overwhelm policymakers’ frantic efforts to cushion what is likely to be a deep global recession. MSCI’s broadest index of Asia-Pacific shares outside Japan lost 5.01%, with New Zealand’s market shedding a record 10% as the government closed all non-essential businesses. Shanghai blue chips dropped 2.51%, though Japan’s Nikkei rose 2.0% aided by expectations of more aggressive asset buying by the Bank of Japan. In Australia, the S&P/ASX200 dropped 5.62% to take the index to a seven-year low.
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In Europe, too, shares were stuck near seven-year lows.
In commodities, Brent crude prices extended falls with demand sliding as travel and industrial activity contracted across the globe in a bid to stem the spread of coronavirus.
(With inputs from Reuters)