Sensex dropped by 1068.75 points to 30028.98, and Nifty tumbled 313.60 points to settle at 8823.25. Sensex and Nifty fell by more than 3% today. Markets may experience further downfall as Coronavirus cases in India cross 100000.
The INR 20 lakh crore economic relief package announced by the Government did not help the financial market and indices closed with bears taking over the market. The financial market dropped to one-month low with the bank, auto and infrastructure sectors declining. Goldman Sachs projected the Indian GDP to fall by 45% for the 1st quarter of the new financial year, thereby hitting investors sentiments.
Top Gainers: Sensex and Nifty
6 stocks gained in today’s market in NSE. Cipla was the top gainer with 5.51% followed by TCS, Infratel, and Infosys gaining around 2.49%, 2.32% and 1.12% respectively. Other gainers include HCL Tech and ITC increased less than 1%.
Losers: Sensex and Nifty
IndusInd Bank dropped enormously by 9.64% today as early signs of recession prevail in India. Zee Entertainment Ltd, Eicher Motors, BPCL and Ultratech Cement also decreased by 9.50%, 7.88%, 7.28% and 7.19% respectively. Other losers from today’ session included HDFC, Axis Bank and ICICI Bank tanking around 7%.
Why Markets are Falling despite 20 Lakh Crore Stimulus?
The lockdown extension till 31st May 2020 remains the main reason for markets falling. Although the government allowed considerable relaxations still there seems no respite in the near future.
Nifty Being Pulled by Bears
On Friday, after recovering the losses, NIFTY settled flat and ended in the red. Analysts predict that Nifty might drop below 8900 levels.
Mutual Funds Witness Huge Selling
Mutual funds experienced biggest sell-off in last 4 years. INR 7965.5 crore worth of stocks were sold-off in April month with Media, Metal, Auto sectors making quick exit.
US Dollar and Oil Prices Gain Grounds
On Monday, US Dollar gains despite the global tension brewing between the US and China. Oil prices witnessed a hike of more than USD 1 per barrel, which is the highest since hitting zero. Brent Crude oil and US WTI settled at USD 33.84 and USD 30.83 respectively.
USA Creates Problem for China’s Huawei
The US restricted Huawei to use American technology. In turn, Chinese officials stated that they would take strict measures against this behaviour and safeguard the rights of Chinese companies.
Recession to Hit India
India to witness recession due to lockdown restrictions and contracting GDP as per data provided by Goldman Sachs. An assumption of GDP dropping 45% for the 2nd quarter as compared to previously analyzed to 20%.
Exports Shrunk by 60.28% for April
Due to lockdown restrictions and spread of Coronavirus spread, India’s exports contracted and dropped by 60.28% in April which totals to USD 10.36 billion.
Lockdown 4.0 announced various relaxations and the “Atma Nirbhar Bharat” relief package may provide some relief in the coming days.