Sensex and Nifty ended over 4% lower each on Monday with coronavirus cases crossing the 1,000 mark in India amid weak global markets. Extending decline for the second straight session, Sensex ended 1,375 points lower at 28,440 and NSE 50-share index Nifty fell 379 points to close at 8,281.
Overall, 24 of 30 stocks on Sensex and 38 of 50 stocks on Nifty ended in the red. Barring FMCG and Pharma sector, all other indices closed in the red, with financials and realty ending 7% lower.
Commenting on the markets closing on Monday, Ajit Mishra, VP - Research, Religare Broking said,"The sell-off resumed in the Indian markets on Monday, citing the rising risk of community transmission as the total number of coronavirus crossed 1100 mark in India. Besides, the lockdown in the major cities has also started showing its impact and top think tanks are now vocal about the strong possibility of further contraction in growth numbers, if the lockdown continues longer than expected."
On Friday too, indices declined tracking the global trend, despite stimulus packages announced by the government and central bank RBI.
According to analysts, investors are sitting on the fence amid the pandemic situation that has started showing its impact on various businesses and sectors, with governments closing borders, issuing self-containment advisories, and banning public gatherings.
Vinod Nair, Head of Research at Geojit Financial Services said,"As expected, the markets have set aside the stimulus measures announced by the RBI and the government, and focused on the rising virus infections and its impact on the Indian economy. With a global recession already declared by the IMF, the recessionary forces and the general uncertainty are forcing investors, especially the FIIs, to redeem their investments."
Rupee, the local currency, fell to hit day's low amid the coronavirus scare and traded 87 paise lower at 75.54 per US dollar.
In the light of COVID-19 pandemic, market regulator SEBI announced today temporary compliance relaxation to Credit Rating Agencies. Further, Prime Minister Modi will address all Indian envoys at 5 pm today, in a move to combat the covid19 threat.
Oil prices extended last week's decline and fell further on Monday as coronavirus continued to add casualties across the globe and price-war between Saudi Arabia and Russia saw no signs of abating. Brent Crude traded at $23.29 per barrel, down 6.58%.
Globally, indices traded deep in red as investors turned risk-averse amid rising lockdowns due to the virus spread. On Wall Street, stocks closed lower on Friday as the US surpassed Italy and China in terms of the total Coronavirus cases. Asian markets were also trading lower for the day, with Nikkei down over 4%. Tracking weak cues from other global counterparts, European indices on Monday opened in red territory as coronavirus outbreak continued to stoke fears of economic recession. While FTSE and CAC tanked 2% each, DAX traded 1% lower.
Globally, there are over 7.2 lakh confirmed cases and 33,976 deaths from the coronavirus outbreak. Of these, over 1.85 lakh have recovered. In India, coronavirus cases continued to rise despite a complete lockdown to cross 1,100-mark. On Friday, the third day of the lockdown saw a rise to 116 in new cases. The country saw the highest surge in infections on Wednesday, at 121, the first day of the lockdown.
As of Monday, the number of infected cases in India has increased to 1,100, with 95 recovered cases. Death toll from coronavirus in India has risen to 30.
Sensex and Nifty have dropped 24% each since the beginning of this month, However, in the last week's session, Sensex has gained 11.2%, Nifty rose 10.7%. Sector-wise, metal has fallen 46% year-to-date, auto has lost 39%, PSU 38%, banks 37%, followed by 36.6% drop in Oil and Gas.
On Nifty's near term technical view, Rohit Singre, Senior Technical Analyst at LKP Securities said,"'Index started a week on weaker note and closed a day at 8281 with loss of more than 4 percent forming a bearish candle for second consecutive day. Index has strong resistance around 8550 zone until index is trading below same we may see current fall to continue towards 8150-8000 zone, traders are suggested to use sell on rise strategy with keeping overall stop out levels above 8550 zone."