India's equity market is experiencing a crash on Friday as the BSE Sensex has fallen by nearly 1,400 points and the NSE Nifty 50 crashed 400 points intraday in the first 3 hours of trading.
At 12.25 pm, the Sensex was down 1,350 points or over 2% to 57,450. The Nifty, too, plunged over 2% during today’s trading session at 17,130 level.
This fall comes after the benchmark indices had fallen by 2% on Monday.
Friday's bloodbath, according to market experts, is caused by the discovery of a new mutation of coronavirus in Africa (B.1.1529), which poses another set of challenges to global economic recovery.
"The Indian benchmarks has a gap down opening today tracking weak Asian markets. Traders will be concerned as WHO flags the new Covid-19 strain. Foreign portfolio investors (FPIs) remained net sellers for Rs. 2300.65 crore in the Indian markets. There will be some cautiousness as ICRA report said that Reserve Bank of India’s revision of bad loan recognition and upgradation norms could bring a sharp spike in non-performing assets of non-banking finance companies (NBFCs) in the country," said Likhita, Senior Research Analyst, Capitalvia Global Research.
In the 30-share Sensex pack, only Dr. Reddy's, TCS and Nestle were trading in green while the rest 27 were in red. NBFC and banking stocks were in deep red with Bajaj Finance, IndusInd, SBI, HDFC and Kotak shares falling by 3-4%. Sector-wise, aviation, hospital and multiplexes stocks are witnessing maximum sell-off as the new strain can possibly disrupt their smooth opening. IndiGo and Indian Hotels Company(Taj Group) shares have fallen by 8% so far while PVR and Inox Leisure are down by 8-9%.