Dalal Street recovers from pandemic panic

India's fundamentals strong, global factors impacting stock market: CEA

geetanjali

Geetanjali Minhas | March 13, 2020 | Mumbai


#BSE   #stock market   #finance   #chief economic advisor   #Krishnamurthy Subramanian  


The stock markets in India, continuing the free fall of the past few days following the Covid-19 outbreak fears, plunged further Friday morning. The two leading indices, Senses and Nifty, both hit their lower limits in the early trade, forcing the trading to be halted for 45 minutes, though stocks recovered smartly later in the day.

Sensex closed comfortably at 34,314.74 (up by 1,536.60 over the previous close), and and Nifty closed at 10,023.65, up by 433.50 over the previous close.

Krishnamurthy Subramanian, chief economic advisor to the finance ministry, said that the fall in the stock market was below the global average and current developments in the market were related to global factors. He said that purchasing power in rural areas was going up, there was moderation in inflation and it could come down. The market reaction was not reflecting the economic fundamentals as India had adequate foreign reserves, he argued. 

In the pre-opening session, BSE Sensex fell by more than 3,000 points and Nifty hit the 10% lower circuit. Sensex tanked 2548.94 points to 30,229.20 in the opening session and Nifty opened below 9000 at a record low. NSE Nifty 50 hit the 10% lower circuit and plunged by 729.95 points to 8860.20. Sensex traded 1,860 or 5.68% lower at 31,095 and Nifty fell to 9,058 level, declining 531 points or 5.54%.

At 9.35 a.m. Nifty and Sensex had the largest fall since February 1, 2017 and April 24, 2017 respectively. Concurrently, Nifty Bank was the lowest since April 21, 2017; Nifty Midcap, lowest since June 24, 2016; and Nifty Smallcap was lowest since May 15, 2014.

With a volatile market and halt in trading, the market watchdog SEBI rushed in and held a meeting with exchange officials. However, the both indices have now sharply turned turning green soon.

After hitting a record low in the early trade the Indian rupee too recovered and was trading at 74.05 against the US dollar. The rupee touched a record low of 74.50 in the initial trade on worries over the coronavirus pandemic.

Gaurang Shah, Senior Vice President, Geojit Financial Services, said what happened today was an overreaction and the markets were not going to shut down nor the economy would go in reverse gear or GDP have negative numbers. “If you are a long-term investor, this is a good time to invest in the market and valuations look extremely attractive. I have been telling investors to buy frontline and large cap companies of specific sectors. The way we have corrected I would not be surprised to see a similar recovery in the market. For the short term, no one can say when the Coronavirus effect will subside or the numbers come down. It has already played havoc not only in India but the world over. Don’t trade for short and medium term, this type of volatility will stay,” he said.
 

Comments

 

Other News

Lost in Transmission: Why calls ‘drop’, what can be done about it

Random call drops across cellular networks has been a major nuisance for consumers. Despite the advent of technologies like 4G, 5G and users upgrading their phones, they continue face the same old problem of call drops. Earlier, with 2G, calling was the primary service from the mobile telephony firms, howe

India’s Semiconductor Mission takes giant leap

The union cabinet on Thursday approved the establishment of three semiconductor units under ‘Development of Semiconductors and Display Manufacturing Ecosystems in India’. Involving a total investment of nearly Rs 1.26 lakh crore, the three units  -- two in Gujarat, one in Assam – wil

Mumbai Airport: Less congestion, fewer delays, says MoCA

Mumbai is one of busiest airports in India, handling a large volume of domestic and international flights including military, non-scheduled and general aviation flights. Mumbai`s Chhatrapati Shivaji Maharaj International Airport (CSMIA) has two intersecting runways which cannot be operated

“900 tenders worth Rs 150 crore?” For ward-level works: BMC

BrihanMumbai municipal corporation is floating nearly 900 tenders worth of Rs 150 crore in the next 10 days, but that is only for ward-level civic works, the BMC clarified on Monday, reacting to reports in a section of media.    “Since there are 25 wards in BMC, it involves m

Elections 2024: Banks, post offices to chip in for voter education

In a first-of-its-kind initiative, Election Commission of India (ECI) on Monday signed a memorandum of understanding (MoU) with two prominent organisations, the Indian Banks’ Association (IBA) and the Department of Posts (DoP), to amplify its voter outreach and awareness efforts ahead of the forthcom

Charming tales of the Snakeman’s early years

Snakes, Drugs and Rock ’N’ Roll: My Early Years By Romulus Whitaker with Janaki Lenin HarperCollins, 400 pages, Rs 699

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter