Markets open in red as second wave coronavirus infections spooks investors

Domestic markets opened in negative territory on Tuesday, following global sentiments as investors remain concerned about countries reporting another wave of Covid-19 infections.

At 9:30 am, BSE Sensex was trading 381.28 points or 1.21 per cent lower at 31,179.94, while NSE Nifty was down by 1.13 per cent at 9,135.25.

By 10 am, markets dived deeper into negative territory as both market benchmarks fell by 2 per cent. Sensex was down over 600 points while Nifty was trading just above 9,000 points.

Banking stocks were worst affected in morning trade as HDFC, HDFC Bank, Axis Bank, Kotak and ICICI Bank stocks traded lower. Maruti Suzuki and Asian Paint were the top losers in morning trade.

It is worth mentioning that all Nifty sectoral indexes were trading in red, led by Nifty Financial Services and Nifty Bank which were down by over 2 per cent. Nifty Auto was also down nearly 2 per cent.

Shares of Piramal Enterprises was down over 9 per cent after the company reported its quarterly numbers for the March quarter. The company reported a net loss of Rs 1,703 crore in Q4FY20 compared to a net profit of over 450 crore in the previous quarter.

Meanwhile, IRCTC shares hit the upper circuit of five per cent for the second consecutive day; shares of IRCTC were trading at Rs 1,368.70.

While volatility has reduced in the domestic market, the sharp spike in cases in India has also dented investor confidence, who are worried about the fate of businesses when the lockdown ends on May 17. Many states have demanded the Centre to continue the lockdown till the end of the month.

Investors are also losing optimism as the Centre is yet to announce a relief package for affected sectors. The government is likely to announce details about the relief package this week, according to reports.

Globally, stock markets have turned nervous again after another wave of infections hit the Chinese city of Wuhan. South Korea and Germany are two other nations that have reported a fresh spike in coronavirus cases.

Experts have recommended countries to ease lockdowns with caution and not rush the process, as it could lead to a sharp spike in cases.

India, too, is working on a strategy to ease the lockdown after May 17 as the country gears up for a massive economic challenge. The country has now registered over 70,000 positive coronavirus cases along with 2,293 deaths.

Read | Coronavirus in India: How life can change after lockdown

Also Read | Covid-19: India hints at opening lockdown as trains to ply from May 12, PM-CMs meet on economy today

Watch | Mega economists’ brainstorm: Experts discuss ways to revive Indian economy post Covid-19

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