19
Mumbai: It was a bloodbath on Dalal Street on Friday, with benchmark equity indices tumbling to five-month lows and into the correction territory.
The double whammy of a global rout due to coronavirus fears and the Reserve Bank of India’s (RBI) moratorium on private lender YES Bank spooked investors.
Stock investors lost Rs 3.48 lakh crore wealth in today’s selloff.
The 30-share Sensex dropped 2.32 per cent or 894 points lower to 37,577, its lowest close since October 7.
The 50-share Nifty closed 2.57 per cent or 289.45 points lower at 10,979.55 points, its lowest close since September 19.
Earlier in the day, Sensex fell as much as 3.79 per cent or 1,459.52 points to 37,011.09 while Nifty was down 3.77 per cent or 423.60 points to 10,827.40 points.
Foreign institutional investors (FIIs) have been on a selling spree.
In the last 14 sessions, they have withdrawn a net Rs 18,343 crore from Indian markets.
Market at a glanceThe bears were in complete control with five shares declining for every one share that advanced on BSE.
A total of 605 companies tested 52-week lows.
Volatility index India VIX jumped 11.70 per cent to 25.96, indicating more choppy times ahead.
The broader market too declined in line with the benchmark, with BSE Midcap and BSE Smallcap indices declining 2.45 per cent and 1.96 per cent respectively.
All the sectoral indices on BSE closed deep in the red.
BSE Metal index and BSE Bankex were the top losers, shedding 4.40 per cent and 3.46 per cent respectively.
Tata Steel and Jindal Steel continued to be hammered and were the top losers in the metal index.
They fell 6.51 per cent and 5.22 per cent, respectively.
YES Bank shares tumbles 55 per cent.
RBL Bank dropped 14.03 per cent, State Bank of India erased 6.19 per cent, while IndusInd Bank shed 5.62 per cent.
As many as 27 of 30 Sensex stocks closed lower, with financials leading the decline.
Mortgage lender HDFC contributed the most to index’s losses, as it shed 3.84 per cent.
Private lenders ICICI Bank and HDFC Bank dropped 3.67 per cent and 1.46 per cent, respectively.
Index heavyweight Reliance Industries fell 3.16 per cent.
Only three Sensex stocks, Bajaj Auto, Maruti Suzuki and Asian Paints, were the only gainers.
Airline stocks continued their journey southwards as fast-spreading coronavirus forced people to cut down travel plans.
SpiceJet and Interglobe Aviation were down 8.93 per cent and 2.79 per cent, respectively.
Amid weak market sentiment, the Rs 206 crore IPO by Antony Waste Handling Cell was subscribed only 49 per cent by 3:30 pm on Day 3 of the bidding process.
YES Bank: From diamonds to dust!Shares of YES Bank tumbled as much as 85 per cent today to hit a record low of Rs 5.55 per share after the banking regulator took over its board and imposed a month-long moratorium.
This was its biggest intraday fall ever.
RBI also put a cap on cash withdrawal from the bank, saying customers cannot withdraw more than Rs 50,000 over next one month.
The stock recovered some losses and closed 56.04 per cent lower at Rs 16.20.
Over the last one year, the stock has eroded 93 per cent value.
Finance Minister Nirmala Sitharaman said that she was constantly in touch with the RBI over YES Bank, assuring depositors of a quick resolution for the private lender.Analysts’ views“We continue to maintain our cautious view on Indian markets and expect volatility to remain high in the near term.
The updates on spread of coronavirus cases would be the single biggest factor dictating global markets going forward.
On the domestic front, updates on resolution plan for YES Bank along with spread of coronavirus cases would be actively tracked by traders and investors.”
- Ajit Mishra, VP - Research, Religare Broking"The selloff in India was triggered by a weak global trend due to the coronavirus outbreak, restricting international travel and trade.
Additionally, moratorium enlarged domestic concern over safety of the financial system and the rupee fell past 74 level due to these issues.
The bailout is a positive development lowering long-term systemic problems and will increase safety for depositors.
Market will be watchful about the final resolution to be offered by RBI - SBI soon."- Vinod Nair, Head of Research at Geojit Financial ServicesGlobal marketsAsian shares and US stock futures tumbled on Friday as disruptions to business from the coronavirus worsened, stoking fears of a prolonged global economic slowdown, Reuters reported.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 2.1 per cent, while Japan’s Nikkei stock index sank 2.94 per cent.
Australian shares were down 2.44 per cent.European shares resumed their slide, with travel stocks bearing the brunt, on fears that the economic damage of the coronavirus outbreak will be much more severe than expected, a Reuters report said.
The pan-European STOXX 600 fell 1.7 per cent, erasing all the gains for the week.
