Sensex, Nifty fall by 6%; Markets react negatively to lockdown extension, trade war bugle

By Mr. Aamar Deo Singh, Head Advisory, Angel Broking Ltd

It was a bloodbath at the equities as Sensex and Nifty tumbled by 5.94% and 5.74% respectivelytoday. At NSE, 13 indices – or more than one-third of the indices listed on the exchange – registered no advances with all stocks trading in the red. The worst affected segments included Banks, Metal, and Auto as they fell more than 7% during the session.

Trade War Bugle, Lockdown Extension weigh on the sentiment:

The entire Asian market was seen tumbling today as Donald Trump signaled towards fresh round of Trade War in the near future. The development is taking place due to China’s alleged role, as claimedby the White House, in the COVID-19 outbreak. With it, Hang Seng fell by 4.18%, Nikkei by 2.84%, and KOSPI by 2.68%. NASDAQ and Dow Jones had also fallen by 3.2% and 2.55% respectively during the previous day. In India, the extension of lowdown for another two weeks further added to the downward trajectory.

Banking Stocks

Banking was amongst one of the worst-affected indices today. Nifty Private Bank, Nifty Bank, and S&P BSE Bankex fell by 8.6%, 8.32%, and 8.25% respectively. At NSE, ICICI Bank led the losses at 11.07% followed by Federal Bank, IndusInd Bank, and Axis Bank with 9.73%, 9.63%, and 9.46% respectively. At BSE, YES Bank experienced the lowest loss by dipping by 3.22%. All other banking stocks dipped by more than 5% today.

Metals tumble by over 7%:

The metal index was also seen trading in the lower spectrum today. At NSE, stocks like Hindalco Industries, Vedanta, and Jindal Steel Power registered more than 10% losses during the trading session. Nifty Metal only had four stocks trading below the 5% losses, with three of them (Welspun Corp, Coal India, and Ratnamani Metal) falling within the range of 4% to 5%, and MOIL ending in 3.63% profit.

Pharma Gives Respite to Investors:

The only sigh of relief today came from the Pharma and Healthcare Sector today. At Nifty Pharma, 9 out of 10 stocks in the indices were green during the closing bell. Aurobindo Pharma led the gains followed by Cipla, Alkem Labs, and Cadila Health at 3.77%, 2.47%, and 1.93% respectively. Only Divis Laboratories fell during the trading session and ended 1.96% lower today.

Bharti Airtel also came out strongly today rallying by about 3.5% today. The voluminous trade, supported by some activity at Idea Cellular, lifted the S&P BSE Telecom index by about 2.39% despite 14 of its 15 stocks falling.