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Sensex Tanks Over 1,000 Points In Opening Trade As Coronavirus Grips Global Markets

A Business Association Has Predicted Dent In Global GDP. Around $250 Billion Investments Will Be Wiped Out If The Current Trend Continues, The Business Body Said.

Agencies | Updated on: 28 Feb 2020, 10:31:18 AM
Stock Market Reuters

Investors will likely focus on the release of the December quarter growth data for clues on how Asia's third-largest economy fared in the last three months of 2019. (Photo Credit: Reuters Photo)

New Delhi/Mumbai/Guwahati :

It’s freaky Friday on Dalal Street! Sensex tanked over 1,000 points in opening trade as coronavirus outbreak gripped the markets amid global selloff. The Nifty plunged 312 points. According to business portal moneycontrol.com, top losers in the Friday morning trade were Tata Motors, Hindalco, Tata Steel, Bajaj Finance, Yes Bank, Gail and M&M. Meanwhile, rupee slipped 33 paise to 71.94 against US dollar in early trade. The COVID-19 outbreak has sparked selloff frenzy amid the investors. A business association has predicted dent in global GDP. Around $250 billion investments will be wiped out if the current trend continues, the business body said.

Investors will likely focus on the release of the December quarter growth data for clues on how Asia's third-largest economy fared in the last three months of 2019. Overnight, the Dow registered a record one-day points drop on Thursday and the S&P 500 confirmed its fastest correction in history, while world share markets were headed for the worst week since the depths of the 2008 financial crisis. "Until last week, the market was of the view that coronavirus is going to have only a minimum impact on global economy ... An increase in the number of new cases is changing the view," Vinod Nair, head of research at Geojit Financial Services, said in a note.

"There are fears of some slowdown in the economy." India's economy grew at 4.7% in the December quarter, according to the median forecast of a Reuters poll of economists, marginally higher than 4.5% in the previous quarter. The economy had expanded at its weakest pace in over six years in the September quarter.

All Nifty 50 shares were trading in the negative territory, with Tech Mahindra leading the losses, down 5.5%. The blue-chip Nifty 50 index is off over 8.5% from its lifetime high hit on January 20, weighed down by the coronavirus outbreak and a lacklustre federal budget.

Earlier on Thursday, Union Finance Minister Nirmala Sitharaman asserted that the anti-CAA protests and the recent violence in Delhi have not dampened the spirit of investors. Addressing a press conference in Guwahati after meeting various shareholders post the Union Budget, Sitharaman said investors whom she met in her recent visit to Saudi Arabia expressed willingness to invest more in India. "I met several investors... both Saudi and Indian investors there. No one showed any concern. On the contrary, they were willing to invest more in India," she said.

Sitharaman claimed that the companies also explored possibilities for opening representative offices in India, reflecting their willingness to invest more. "Lots of interest were shown on various projects," the finance minister said. Asked specifically about protests against the Citizenship (Amendment) Act or the recent violence in Delhi, Sitharaman said, "The sentiment of foreign investors has not dampened at all."

On the possible impact of coronavirus scare on the industry and the economy, she said there is none as of now. "I have met 20-23 industries and they did not express any anxiety about raw material supply. However, if the situation does not improve in the next two months, there might have been problems of raw material shortage, which we are trying to see how best we can help them out," she added.

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First Published : 28 Feb 2020, 09:48:16 AM

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