Stocks Plummet Over 12% On Coronavirus Fears
People walk past the Bombay Stock Exchange (BSE) building in Mumbai on March 9, 2020
Indian shares sank more than 12% by afternoon on Monday as trading resumed after the market’s second halt this month, with investors caught in a selling frenzy as the coronavirus disrupted businesses and sent several states into lockdown.
The blue-chip NSE Nifty 50 index, which fell to a near four-year low of 7,690.1, was down 11.75% at 7,718.85 by 0700 GMT, while the S&P BSE Sensex fell 11.99% to 26,339.2.
Trading in stocks was curbed in the first hour of Monday’s trade as the main indexes plunged 10%, and resumed 45 minutes later.
Over the weekend in India, the virus drove several companies to shut operations and the government sent states into lockdown, bringing normal life to a grinding halt. As of Sunday, India had registered 341 cases of coronavirus, with seven deaths.
India’s market regulator, the Securities and Exchange Board of India, on Friday halved position limits for certain stock futures, restricted short-selling of index derivatives and raised margin rates for some shares to curb “abnormally high” volatility amid the pandemic.
Broader Asian shares and European stock futures also suffered as a rising tide of national lockdowns threatened to overwhelm policymakers’ frantic efforts to cushion what is likely to be a deep global recession.
In Mumbai’s main stock indexes on Monday, financial stocks led the rout. The Nifty PSU Bank Index, which tracks state-owned lenders, slid 11.5%.
The Nifty Private Bank Index plunged 16.2% to a near four-year low.
Top private-sector lender HDFC Bank Ltd was the biggest drag, falling as much as 13.4%.
The auto sector also took a severe beating as companies halted production across the board. The Nifty Auto Index dropped 13.3%, with Ashok Leyland Ltd sinking 19%.
