Sensex, Nifty tumble as lockdown extends, U.S.-China tensions flare

Indian stocks fell sharply on Monday after the government extended a nationwide coronavirus lockdown by two weeks and as tensions between the United States and China dashed hopes of a pick up in global economic activity.

India on Friday extended its nationwide coronavirus lockdown for another two weeks after May 4 while easing restrictions in lower-risk zones, but travel, hotels, restaurants, shopping malls and cinema halls remain shut.

The Nifty ended 5.74 per cent lower at 9,293.50, clocking its worst day since March 23 and the Sensex fell 5.94 per cent to 31,715.35.

The NSE gained 14 per cent in April, its best month in 11 years. Still, Both the NSE and BSE are down roughly 23 per cent this year as the coronavirus pandemic clobbers markets worldwide.

European stock markets and oil prices also fell after U.S. Secretary of State Mike Pompeo said on Sunday there was “a significant amount of evidence” that the virus emerged from a Chinese laboratory. China’s Global Times said in an editorial that Pompeo was “bluffing”.

Pompeo’s comments follow U.S. President Donald Trump’s threat on Friday to slap new tariffs on China over the COVID-19 pandemic.

Shares in Indian lenders HDFC Bank Ltd, Housing Development Finance Corp and ICICI Bank were the top three drags on the Nifty on Monday.

The broad-based selloff also included sharp losses in automotive stocks after reports of near-zero sales by carmakers in April and metals and mining stocks, which have been particularly sensitive to news of any escalations in U.S.-China trade tensions.

China is one of the world’s largest producers and consumers of metals.

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