Domestic stock markets succumbed to losses for the fourth day, amid a broad-based selloff, as the coronavirus pandemic kept investors worried about the possibility of a global recession. The Sensex oscillated in a broad range of 2,656 points between an intra-day low of 26,714.46 in the first half of the session and high of 29,370.53 in late-afternoon deals. The indices in fact recouped all their intra-day losses and eked out gains of almost a per cent in the late afternoon, but the recovery petered out by close. The broader Nifty 50 index also touched a low of 7,832.55 and a high of 8,575.45 during the day. The Sensex ended 581.28 points lower at 28,288.23 and the Nifty settled at 8,269.70, down 199.10 points from the previous close. The broader markets did worse than the benchmark indices; the BSE Midcap index shed 3.7 per cent at 10694 and the smallcap index lost 4.5 per cent at 9722.
Analysts say domestic fundamentals have taken a back seat, with several major markets around the world having entered a bear phase thanks to the coronavirus outbreak. Even emergency measures by central banks in Europe, Japan, the United States and Australia have failed to halt the ongoing panic selling worldwide. With the shockwaves rippling through the stock markets and economies worldwide, and lockdowns becoming a norm amid desperate attempts to control the rampaging virus, the world may be staring at a recession and even a dreaded depression down the line.
The Covid-19 virus remains on the prowl, with more than 2 lakh people infected in 162 countries and the number of coronavirus cases swelling to 167 in India. We are still at the second stage (local transmission) and there is no evidence of community transmission (third stage) as yet, according to Indian Council of Medical Research, but there are growing fears about the road ahead. The Nifty VIX zoomed 12.8 per cent to 72 as market participants continued to be gripped by heightened volatility and fear factor.
The rupee bore the brunt of the coronavirus-induced selloff and registered a new lifetime low of 75.12 against the US dollar. Analysts say weakness across Asian markets and fluctuating crude oil prices are likely to keep rupee under pressure in the near term.
There was red across the Asian markets, with the Kospi Index diving 8 per cent, and Hang Seng, Straits Times and Taiwan indices shedding 1-3 per cent each.
Meanwhile, credit ratings major Standard and Poor’s (S&P) lowered the forecast for India to 5.2 per cent from the earlier 5.7 per cent, adding the timing of a recovery depends most of all on progress in containing the spread of coronavirus.
Financial stocks extended their losses from the previous session. Bajaj Finance nosedived 10 per cent, while Axis Bank, ICICI Bank and SBI lost around 5 per cent each. ONGC, Reliance Industries and L&T also shaved off about 5 per cent each.
On the other hand, ITC, Bharti Airtel and Kotak Mahindra Bank gained around 2-7 per cent each.
The market breadth was weak. Out of 2,561 stocks traded on the BSE, there were 1828 declining stocks as against 574 advances.