Sensex, Nifty Fall As Covid-19 Cases Rise Amid Lockdown

A security official scans a visitor with an infrared thermometer to check his temperature as a precautionary measure against coronavirus outside the Bombay Stock Exchange (BSE) in Mumbai on March 16, 2020

Indian shares fell on Wednesday as the number of coronavirus cases increased in Asia’s third-largest economy even as a 21-day lockdown remained in force.

The broader NSE Nifty 50 index was down 2.1% at 8,416.95 by 0436 GMT and the benchmark S&P BSE Sensex fell 2.15% to 28,835.29.

India had 1,238 active coronavirus cases and 35 deaths due to the disease as of Tuesday evening.

Many manufacturing operations in India were forced to halt to contain the spread of the virus and production has seen a decline, especially among automakers, with the outbreak affecting supply chains.

The country’s central bank also announced a moratorium on repayment of some loan installments due between March 1 and March 30.

“There is concern about the lockdown, which has started to affect many sectors, and about how the moratorium will affect banking,” said Vinod Nair, head of research at Geojit Financial Services in Kochi.

“This concern will continue till there is confidence that industries can return to production after the lockdown.”

Rating agency S&P Global on Monday cut its estimate for the country’s economic growth for the full year ending 2021 to 3.5% from 5.2%.

The lockdown is scheduled to end around mid-April, just as the corporate earnings season begins. The government said it had no plans to extend the lockdown.

Nearly all sectors were trading in the red on Wednesday with banks leading declines.

The Nifty banking index, which tracks both state-owned and private-sector lenders, fell 2.95%. The Nifty financials index was down 2.55%.

Kotak Mahindra Bank fell over 7.7% and was the biggest loser among stocks on the blue-chip index followed by ports operator Adani Port and Special Economic Zone Ltd, which fell about 5.3%.

State-owned lender Indusind Bank rose 2.8% and topped the gainers list after the company said its promoter repaid all its loans and was debt free.

Meanwhile, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.23%, helped by a bounce in Australian shares, but risks for equities remained as the pandemic threatened global growth.