Black Monday: Rs 8.23 lakh crore investor wealth wiped off as Sensex plummets 1,707 points
Sensex was nosedived 1,707 points or 3.44% at 47,883, and the Nifty tanked 524 points or 3.53% at 14,310.
It was deja-vu for investors on Dalal Street as fears of stricter lockdowns will be levied by the state government to curb the second wave of Covid-19, hampering the economic recovery that many analysts have estimated. The panic selling saw investors wealth eroding by Rs 8.23 lakh crore.
At close, Sensex was nosedived 1,707 points or 3.44% at 47,883, and the Nifty tanked 524 points or 3.53% at 14,310. The market breadth was weak as 493 shares have advanced, 2433 stocks declined, and 171 shares are unchanged.
Dr Reddy’s the only constituent on the Sensex ended with gains of 4.83%. Among the losers, IndusInd Bank tanked the most down 8.6%, Bajaj Finance, SBI, ONGC and Titan plunged over 5%.
“Domestic equities reminded the bloodbath of March 2020 as record rise in COVID-19 cases in the country and possibility of lockdowns in several states dented investors’ sentiments,” said Binod Modi, Head – Strategy at Reliance Securities.
Concerns of a possible reversal in economic momentum and earnings recovery made investors risk-averse and huge selloff led to the erosion of nearly Rs 9 lakh crore in investor wealth, he added.
Sectorally, the Nifty PSU Bank index sank over 9%, while the Nifty Realty slipped 7%. Nifty Metal, Nifty Bank, and Nifty Auto indices skidded in the range of 5-6%. Nifty IT & Nifty FMCG lost around 2%. Only the Nifty Pharma index managed to end with a marginal loss of 0.26%.
In the broader market, the bloodbath was even severe as BSE MidCap and BSE SmallCap indices plunged around 5% each.
COVID-19 update:
India on Monday reported 1,68,912 new COVID-19 cases and 904 deaths in last 24 hours, according to data from the Union Health Ministry.
Economy:
India’s foreign exchange reserves declined $2.415 billion to stand at $576.869 billion in the week ended 2 April 2021, RBI data showed on Friday. The reserves had touched a record high of $590.185 billion in the week ended 29 January 2021.
The gold reserves dropped by $884 million to $34.023 billion in the reporting week, as per the central bank data. The special drawing rights (SDRs) with the International Monetary Fund (IMF) dipped by $4 million to $1.486 billion.
Meanwhile, commercial banks in India gave almost one-fourth of loans (about Rs 1.55 trillion) in the last fortnight of the financial year. The total lending was Rs 5.80 trillion in FY21 lower than about Rs 6 trillion in FY20. The outstanding credit stood at Rs 109.51 trillion as of 26 March 2021, according to Reserve Bank of India data. On a year-on-year (Y-o-Y) basis, the lending by commercial banks rose by 5.6% in the financial year (FY21), a period marked by economic contraction due to COVID-19 pandemic against 6.1% in FY20.
Global markets:
Shares in Europe and Asia saw a mixed trend on Monday as global stocks continue to search for direction after record highs in several regions last week.
The U.K. government is relaxing lockdown measures in England on Monday, with outdoor dining and hospitality venues, hairdressers, gyms, shops and outdoor attractions allowed to reopen.
In the U.S., the Dow Jones Industrial Average and S&P 500 index closed at record highs Friday as investors remain cautiously optimistic about economic growth and progress against the pandemic. Stocks linked to the recovering economy led the gains again amid the accelerating vaccine rollout.
On the data front, the U.S. producer-price index rose 1% in March, the U.S. Labor Department said Friday. The rate of wholesale inflation over the past 12 months climbed to 4.2% in March. That’s the highest level since September 2011.