Markets’ worst day ever, Sensex to soon wipe off entire Modi era gains

Bloodbath as Sensex crashed almost 4,000 points to enter 25K-mark on Monday

Narendra Modi [File] The Indian stock markets had been unstoppable since Narendra Modi was first sworn in as PM | PTI

Indian equity markets witnessed the worst day in its history with the BSE Sensex set to wipe off all the gains made since May 2014, when it first breached the psychological barrier of 25,000 as Narendra Modi was elected the prime minister. On Monday, the benchmark Sensex tumbled 3,934.72, or 13.15 per cent, to end at 25,981.24 points, while the Nifty 50 index settled 1,100.85 points, or 12.70 per cent, lower at 7634.60.

The Indian stock markets, which have been unstoppable ever since Narendra Modi was first sworn in as prime minister in May 2014, is on its way to completely erase all market gains of more than five years. On May 16, 2014, both the Sensex and the Nifty had hit a record high. The BSE Sensex surpassed the psychological barrier of 25,000, while the Nifty touched the 7,500-mark, ending at an all-time intra-day high of 7,563.

The Indian markets never turned back since then, the brief demonetisation blues notwithstanding. However, the scene changed as coronavirus sent chills across worldwide markets in February this year.

On February 25, the Sensex was in the 40,000-range, while the Nifty was trading at 11,829. And it has been a free fall since then.

The BSE benchmark index lost over 14,000 points within a month. The Nifty crashed nearly 4,300 points over the same period. Indian market investors, who refused to bow down even under the economic slowdown witnessed during the latter half of 2019, look a panicked pack as the pandemic spreads, with India entering a lockdown mode on Monday.

Banking and auto stocks were the most battered in the Monday mayhem. Axis Bank, IndusInd Bank and Bajaj Finance were the top losers, while HDFC Bank, Reliance Industries, ICICI Bank, HDFC and TCS were the most active stocks. Fear gauged India Volatility Index, or India VIX, which traded 7.10 per cent higher at 71.8675.

The Monday mayhem ensured that stocks of as many as 1,042 companies, including Axis Bank, Bajaj Finserv, Bajaj Auto, Bajaj Finance, Bharat Petroleum, Grasim Industries, HDFC Bank, Hindalco, ICICI Bank, InterGlobe Aviation, Larsen & Toubro, IndusInd Bank, Mahindra & Mahindra, NTPC, Maruti Suzuki, Reliance Industries, State Bank of India and Sun Pharmaceutical Industries touched their 52-week lows. Earlier in the day, trading was halted for 45 minutes—the second in 10 days—as the Sensex fell 10 per cent in morning trade.

Meanwhile, the rupee, which plummeted to a fresh low of 76.15 in morning trade, pared the early losses. Yet, it was trading lower by 71 paise at 75.90 against the US dollar.

Amid the market bloodbath, the RBI has stepped in by offering large liquidity support to the markets and the financial system to prevent a freeze in credit markets. On Monday, the central bank said it would offer Rs 1 lakh crore to banks via repo operations. Of the total amount, Rs 50,000 crore will be offered on Monday and another Rs 50,000 crore on Tuesday.

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