The Indian equity benchmarks fell sharply on Wednesday on the back of weak global cues amid a broad-based selling pressure. The benchmarks opened lower and extended losses in noon deals as rising Covid-19 cases weighed on investors’ sentiment. The Sensex fell as much as 798 points and Nifty 50 index dropped below its important psychological level of 14,600. Markets fell across the globe after Germany extended its lockdown until April 18 stoking fears of a longer road to economic recovery, analysts said.
As of 12:07 pm, the Sensex was down 639 points at 49,412 and Nifty 50 index declined 188 points to 14,626.
Back home, daily COVID-19 cases hit a more than four-month high on Wednesday. The government has said it would expand its vaccination campaign from April to include everyone above 45.
“The economic activity comes down with surge in (virus) cases,” Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services in Mumbai told news agency Reuters.
“The global market cues are not very positive. COVID-19 cases are going up globally and that is a major concern. Until you see some cool off sustainably in commodity prices and bond yields, equity markets are unlikely to go up in a hurry,” Mr Khemka added.
Meanwhile, selling pressure was broad-based as all the 11 sector gauges compiled by the National Stock Exchange, barring the index of pharma shares, were trading lower led by the Nifty Bank index’s over 2 per cent fall. Nifty Auto, Financial Services, IT, Metal, PSU Bank, Private Bank and Realty indexes also fell between 1-2 per cent.
Mid- and small-cap shares were also facing selling pressure as Nifty Midcap 100 and Nifty Smallcap 100 indexes dropped over a per cent each while the gauge of expected volatility on the NSE – India VIX index spiked over 7 per cent.
HDFC, ICICI Bank, Reliance Industries, Infosys, HDFC Bank, Axis Bank and Kotak Mahindra Bank were among the top drags on the Sensex. They collectively wiped out over 35 points from the 30-share index.
ONGC was top Nifty loser, the stock fell 3.9 per cent to Rs 103. Tata Steel, Hindalco, GAIL India, State Bank of India, UPL, Mahindra & Mahindra, Axis Bank, Larsen & Toubro, HDFC, ICICI Bank, SBI Life, Kotak Mahindra Bank, Tata Motors, Bajaj Finance and IndusInd Bank also declined over 1.5 per cent.
On the flipside, Asian Paints, Cipla, Power Grid, Sun Pharma, Dr Reddy’s Labs, Divi’s Labs and Hero MotoCorp were among the notable gainers.
The overall market breadth was extremely negative as 1,763 stocks were declining while 899 were advancing on the BSE.