Sensex tanks over 1700 points, Nifty falls below 8,500 (Photo Credit: file photo )
Sensex nosedives over 1,700 points to end at 28,869.51 while Nifty also settled on negative note after dropping 498.25 points at 8468.80. Global stock markets sank Wednesday in a third day of wild price swings after President Donald Trump promised aid to get the US economy through the coronavirus outbreak. London and Frankfurt opened more than 3 per cent lower and Shanghai, Tokyo and Hong Kong all declined. Australia’s main index fell 6.4 per cent.
The White House proposal could approach USD 1 trillion in spending to ward off the pressure of business closures to contain the virus. The Federal Reserve has announced more measures to keep financial markets operating. On Tuesday, the S&P rose by an unusually wide daily margin of 6 per cent, regaining just under half the previous day’s history-making loss.
The Dow advanced 5.2 per cent. Investors expect more volatility until the virus is brought under control. Trump’s proposal would include USD 250 billion for small businesses and USD 50 billion for airlines. There are “green shoots of risk appetite emerging, and some further concerning aspects,” said Chris Weston of Pepperstone Group in a report.
“I am not going to call a bottom in the risk story by any means.” The FTSE 100 in London dropped 4.3 per cent to 5,066.96 and Frankfurt’s DAX skidded 3.7 per cent to 8,606.79. France’s CAC 40 shed 3.4 per cent to 3,873.71. On Tuesday, European markets swung from gains to losses and back to gains.
In Asia, the Shanghai Composite Index fell 1.8 per cent to 2,728.76 while the Nikkei 225 in Tokyo shed 1.7 per cent to 16,726.55. Hong Kong’s Hang Seng skidded 4.2 per cent to 22,291.82. The Kospi in Seoul slumped 4.9 per cent to 1,693.95. Australia’s S&P-ASX 200 plunged to 5,320.20. New Zealand and Singapore rose 1 per cent while Manila fell 7.9 per cent. Bangkok surged 2.8 per cent. On Monday, the Dow lost nearly 3,000 points after Trump said a recession may be on the way. The S&P is off 25.3 per cent from last month’s record.
Gold prices on Wednesday rose by Rs 311 to Rs 40,241 per 10 gram in the national capital amid rupee depreciation and higher buying, according to HDFC Securities. The precious metal had closed at Rs 39,930 per 10 gram on Tuesday. “Spot gold for 24 karat in Delhi was trading up by Rs 311, reflecting Tuesday’s gains of international gold prices.
Gold prices in India also got support from rupee depreciation with spot rupee trading around 13 paise weaker against the dollar during the day,” HDFC Securities Senior Analyst (Commodities) Tapan Patel said. Silver prices, however, fell by Rs 468 to Rs 35,948 per kg against the previous close of Rs 36,416 per kg.
In the international market, both gold and silver were trading lower at USD 1,490 per ounce and USD 12.38 per ounce, respectively. Meanwhile, the domestic equity market continued the weak trend, closing 1,709.58 points lower.
(With inputs from PTI)