INSUBCONTINENT EXCLUSIVE:
Benchmark equity indices BSE Sensex and NSE Nifty tanked over 6 per cent in Monday’s early trade due to panic selling amid the coronavirus
pandemic.
The 30-share Sensex traded 2,182 points, or 6.40 per cent, down at 31,921 at around 9.35 am, while the 50-share Nifty slipped 616
points, or 6.20 per cent, to 9,339.
Monday’s crash wiped out over Rs 6 lakh crore of equity investors' wealth within first 15 minutes of
Amit Gupta, co-founder and CEO, TradingBells said, “It is best for investors to stay away from this market for a while till the time the
volatility settles and we can see some notable reversals.”
Here is what caused the massive selloff:Fed rate cut: Global markets took a hit
after the US Federal Reserve slashed its key interest rate to shore up economic growth in the face of mounting global anti-virus controls
that are shutting down business and travel
The US Fed cut rates back to near zero, restarted bond buying and joined other central banks to ensure liquidity in dollar lending
Asian peers Hang Seng and Shanghai were down up to 2.50 per cent in morning’s trade.
According to experts, a surprise 100 points rate cut
by the US Federal Reserve is likely to scare investors more than cheering them as it reflects the fear among US policy makers about the
severe impact of the virus outbreak on the world’s largest economy
Coronavirus scare: Market sentiment in India further deteriorated after the number of novel coronavirus cases in the country rose to 110 on
Sunday, with Maharashtra reporting the highest followed by Kerala
Over 450 stranded Indians were flown back from Italy and Iran, the two worst-affected countries after China, and quarantined.
India Inc
under pressure: Credit pressures have intensified on India Inc as the coronavirus spread deepens in the country and across the globe,
leading domestic credit ratings agency Crisil said on Friday
Airlines, hotels, malls, multiplexes and restaurants will be the worst hit businesses, it warned.
FII outflows: Market participants are also
concerned as foreign portfolio investors (FPIs) have withdrawn over Rs 35,000 crore on a net basis from the domestic markets in March so far
amid the coronavirus pandemic triggering fears of a global recession.
Inflation fear: Traders are also cautious ahead of the Wholesale Price
Index (WPI) data to be out later in the day
Besides, the government had hiked the excise duty on petrol and diesel by Rs 3 per litre each to garner about Rs 39,000 crore additional
revenue, as it repeated its 2014-15 act of not passing on gains arising from slump in international oil prices
Higher fuel prices may bring back fears of spike in inflation.