Markets

Sensex slumps 2,919 points, Nifty sinks to 33-month low

Stock brokers react as sensex falls on March 12, 2020, in its biggest one-day fall in absolute terms.

Stock brokers react as sensex falls on March 12, 2020, in its biggest one-day fall in absolute terms.   | Photo Credit: Emmanual Yogini

Indian benchmarks register their biggest single-day fall.

A day after the World Health Organization (WHO) declared the coronavirus outbreak a pandemic, equity markets worldwide went into a bear phase — denoted by more than 20% fall from the recent highs of the benchmarks.

The Indian benchmarks registered their biggest single-day fall on Thursday, with the Sensex plunging 2,919.26 points, or 8.18%, to close at 32,778.14 — over 22% lower than its January high of 42,273.87. This was the lowest close for the index in nearly two years.

Deep losses

All 30 stocks in the Sensex ended the day with deep losses, with heavyweights such as HDFC Bank, TCS, Axis Bank, ONGC, State Bank of India (SBI) and ICICI Bank shedding over 9% each on Thursday. Most of the Sensex constituents touched their 52-week lows.

The dampened investor sentiments could be further gauged from the fact that more than 500 stocks touched their lower circuit on the BSE, even as 2,265 stocks ended in the red as against only 201 gainers.

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The broader Nifty fell below the psychological 10,000 mark to close at its lowest level since June 2017. The index lost 868.25 points, or 8.30%, to close at 9,590.15.

The India VIX index jumped over 31% after witnessing a jump of 35% on Monday last.

Sensex slumps 2,919 points, Nifty sinks to 33-month low
 

The announcement by President Donald Trump restricting travel to the U.S. from Europe further dented investor sentiments.

“Global stocks, including India, plunged into a bear market after President Donald Trump banned travel from Europe to stem the coronavirus, threatening more disruption to the world economy,” said Deepak Jasani, Head-Retail Research, HDFC Securities. “Global recession risk is rising and the markets do not seem to be pricing that in fully,” he added.

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Incidentally, equity markets opened in the U.S. on Thursday with a sharp fall with the benchmark Dow Jones Industrial Average hitting its circuit breaker of 7% for trading to be halted for 15 minutes. Elsewhere in Asia, the benchmarks of Hong Kong, Japan, Taiwan, Indonesia and South Korea all fell between 3% and 5% each.

Foreign investors continued to sell Indian equities with Thursday’s selling pegged at nearly ₹3,500 crore. The current month’s net sales are already nearing the ₹23,000-crore mark.

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“The markets have corrected sharply on back of huge selling by FPIs that are moving out of equities across emerging markets. FPIs have become risk-averse and are moving to safe havens. The Nifty 50 index is down 22% from its peak, and incremental pain cannot be ruled out as the sentiment metrics are yet to turn around and signal capitulation,” said Vikas Jain, Senior Research Analyst, Reliance Securities.

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Printable version | Apr 2, 2020 3:24:10 AM | https://www.thehindu.com/business/markets/sensex-down-by-over-2900-points-in-biggest-one-day-fall/article31049281.ece

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