IGI Logo

Domestic benchmark indices plummeted on Monday as rising coronavirus cases and resultant lockdown continued to spook investors. Today, the start of session is likely to be positive. Traders will be getting support with report that the government announced a liberalised and accelerated Covid-19 vaccination programme beginning May 1, where all above 18 years of age will be eligible to be vaccinated. Also, vaccine manufacturers have been empowered to release up to 50% of supplies directly to state governments and in the open market at pre-declared prices, a move that would boost availability of the prophylactics to the people. Meanwhile, India reported a slight decline of 256,947 in the number of fresh coronavirus (Covid-19) cases on Tuesday, Worldometer showed. With this, India’s Covid tally has shot up to 15,314,714 cases. India, however, reported the highest-ever single-day spike in Covid-related deaths with 1,757 fatalities. The death toll from the deadly infection stands at 180,550. The country now has over 2 million active cases. Traders may take note of report that the Reserve Bank of India has formed a six-member panel headed by Sudarshan Sen, former Executive Director, to carry out comprehensive review of the working of Asset Reconstruction Companies (ARCs) in the financial sector ecosystem. The panel will recommend suitable measures for enabling such entities to meet the growing requirements of the financial sector. The Committee will submit its report within three months from the date of its first meeting. However, traders will be concerned with a private report stating that the pandemic has impacted the working capital management for companies and stretched top-500 listed companies’ cash cycles by six days. There may also be some cautiousness as the Centre for Monitoring Indian Economy (CMIE) in its latest data has said unemployment rate in urban India has been on the upswing since the beginning of the current month. From 7.21% on April 4, it jumped to 9.81% for the week ended April 11 and further to 10.72% for the week ended April 18. This reflects a shift in the burden of job losses to urban India, reversing the trend of rural India largely bearing the brunt of Covid-induced strain on employment.

The US markets ended lower on Monday as weakness in the technology sector weighed on the markets. Asian markets were trading mostly higher in early deals on Tuesday, led by a stronger Chinese opening and shaking off the initial drag from tech-driven Wall Street losses.

Back home, Indian equity benchmarks witnessed bloodbath on Monday and settled below their crucial 48,000 (Sensex) and 14,400 (Nifty) levels amid continue rising COVID-19 cases in the country and stricter restrictions imposed in various states. Markets made a gap-down opening as traders remain concerned on report that India reported 275,306 coronavirus disease (Covid-19) cases, the highest single-day spike so far since the pandemic broke out, Worldometer showed. With this, India's Covid tally has shot up to 15,057,767 cases. Adding more pessimism, a private report stated that leading brokerages have downgraded India's GDP growth projections for the current fiscal year to as low as 10 per cent on local lockdowns threatening fragile recovery, with the resurgence of COVID-19 cases posing risks to economic recovery. Also, foreign portfolio investors (FPIs) have pulled out a net Rs 4,615 crore from Indian markets in April so far amid sharp escalation in COVID-19 cases and the consequent restrictions imposed by various states, unnerving overseas investors. Markets traded in deep red throughout the day as sentiments remain dampened after the Shopping Centres Association of India (SCAI) said that businesses have been severely impacted, with the revenue falling by almost 50 per cent due to localised lockdowns to prevent the spread of COVID-19 in the country. Many state governments have imposed restrictions and localised lockdowns to stop the spread of the virus. However, markets managed to trim some of there losses in the later part of trade after Finance Minister Nirmala Sitharaman said she has taken inputs from various industry chambers on concerns of India Inc with regard to the management of COVID pandemic and the centre would continue to work with state governments to save lives and livelihood. She sought feedback from businesses to deal with the impact of the second COVID-19 wave on the country’s economy. Finally, the BSE Sensex fell 882.61 points or 1.81% to 47949.42, while the CNX Nifty was down by 258.40 points or 1.77% to 14359.45.

Above views are of the author and not of the website kindly read disclaimer