Sensex drops 1,190 points Investors Rs 6.79 lakh crore poor
Equity indices fell to four-month lows on Monday as a surge in Omicron cases across the globe shocked investors, leading to heavy selling in global markets. Traders said continued selling by foreign investors amid leaning central banks also weighed on the sentiment.
The BSE 30-share Sensex closed 1,189.73 points or 2.90 per cent lower at 55,822.01, its lowest level since August 23 this year. Similarly, the NSE Nifty ended 371 points or 2.18 per cent lower at 16,614.20.
The market capitalization of all the companies listed on BSE declined by Rs 6.79 lakh crore to Rs 2,52,57,581.05 crore. Tata Steel was the top laggard in the Sensex pack, falling 5.20 per cent, followed by IndusInd Bank, SBI, Bajaj Finance, HDFC Bank. Kotak Bank and NTPC.
Only HUL and Dr Reddy’s managed to close in the green, rising up to 1.70 per cent. According to experts, the explosion in COVID-19 cases, sustained selling by foreign institutional investors and slow growth in developed economies have shaken the markets across the world.
“India has been going through a consolidation phase in the last two months. Currently, the sell-off is due to a sharp increase in FII sales, driven by the policy of hawkish world central banks, due to higher valuations than peers. A cautious outlook on the Indian market and a decline in retail flows, said Vinod Nair, Head of Research, Geojit Financial Services.
“We think we are approaching the final stage of this consolidation in terms of price correction. Some pockets have turned fair, however, the overall market is still trading on the upper hand which continues to impact the performance of the broader market. Will keep short-term,” he said.
Ajit Mishra, VP – Research, Religare Broking, said the markets reacted to the news of a sharp jump in COVID cases globally, which may result in the lockdown.
“While the situation is currently under control domestically, any impact on the global economic recovery will affect our prospects as well.
Besides, consistent outflow of foreign funds also weighed on the sentiment. We reiterate our cautious outlook on the markets and suggest increased focus on risk management.”
All sectoral indices ended in the red with BSE Realty, Oil & Gas, Metals, Bankex and Energy indices falling up to 4.74 per cent.
The broader BSE Midcap and Smallcap indices fell up to 3.42 per cent.
Global equities fell after a surge in Omicron cases, raising the prospect of a new lockdown ahead of the Christmas and New Year holidays.
Elsewhere in Asia, shares ended with heavy losses in Shanghai, Hong Kong, Tokyo and Seoul. Stock exchanges in Europe were also trading in deep red in mid-session deals.
Meanwhile, international oil benchmark Brent crude fell 3.51 per cent to $70.94 a barrel. However, the rupee on Monday advanced 16 paise to 75.90 against the US dollar for the third consecutive session as easing crude oil prices revived otherwise weak sentiment.
Foreign institutional investors continued selling shares in the capital market on Friday as they sold equities worth Rs 2,069.90 crore, data from the exchange showed.
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