Mumbai: The gory impact of the second wave of Covid-19 adversely impacted investors’ sentiment on Monday as the domestic benchmark indices nosedived, leaving the market bulls battered.
Investors sold stocks across the board, resulting in a 1,469-point crash on the BSE barometer Sensex in intra-day trade. The index, however, recovered some losses and ended 883 points lower at 47,949.
Barring shares of Dr. Reddy’s Labs and Infosys, all constituents of the 30-pack index traded in the red.
Meanwhile, its NSE counterpart Nifty, after shedding 425 points, ended with a 258-point cut at 14,359. The sell-off was equally bad in the broader markets as mid-cap and small-cap indices lost 2.1 – 2.4 percent lower. Except for Nifty pharmaceuticals, all indices on NSE traded in the red.
“The steady rise in Covid test positivity cases and decline in recovery rates are areas of serious concern. But, this negativity need not reflect fully in the market since the global clues are positive. The decline in US 10-year yield from the recent high of 1.75 percent to 1.56 percent presently is a major relief and support to markets,” said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, according to media reports.
The biggest single-day spike of over 2.74 lakh cases in 24 hours once again spooked investors on Dalal Street, as they feared its impact on economic and earnings growth following lockdown-like restrictions by most states to curb the spread of the virus.
The second wave of Covid-19 in India has cast a cloud over economic growth and earnings outlook going ahead, worrying investors. Economic recovery is also seen shifted to the second quarter of 2021-22.
(VP)