Sensex, Nifty make record recovery after halt in trading amid coronavirus fear

Financial markets have taken a severe beating over the last few weeks as coronavirus disrupted businesses across the world.

Stocks seesawed on Friday after a choppy session as the markets saw a 10% crash after coronavirus fears triggered a rare “circuit breaker” or trading halt earlier in the day.

Trading on the exchanges hit a “circuit breaker” a few minutes into Friday’s session, the first time since 2009, as widespread panic over the coronavirus pandemic gripped global markets.

The S&P BSE Sensex index and the broader NSE Nifty 50 benchmark swung wildly after the markets resumed trading at 10:20 am but managed to erase some of the losses. The Nifty was down 0.73% at 9,553.7 by 0548 GMT, while the Sensex traded down 0.54% at 32,611.5.

The volatility index surged 44% to its highest in over a decade.

“I don’t think this is a return of positive sentiment, markets are very volatile,” said Sujan Hajra, chief economist at Anand Rathi Securities, said while speaking to news agency Reuters.

“Markets are acknowledging that they are in the oversold zone so there is some buying support coming in,” he said.

The rupee, which earlier fell to a record low of 74.5075 against the dollar, reversed losses to trade about 0.4% stronger at 73.99.

Housing Development Finance Corp Ltd was the top boost to the stock indexes, jumping as much as 5.5%, while Sun Pharmaceutical Industries Ltd surged nearly 10% and was headed for its best day in more than eight years.

The Nifty Pharma index was last up 2.5% and the Nifty Bank Index a touch higher.

Coronavirus pandemic

India reported its first death from the virus late on Thursday, and new cases continued to be on the rise 75 cases so far. Covid-19 has claimed over 4600 lives and infected more than 125,048 people across 118 countries and territories since it originated in China late in December last year.

The World Health Organization (WHO) on Thursday declared coronavirus (Covid-19) pandemic, denting the investor sentiment further.

Financial markets have taken a severe beating over the last few weeks as coronavirus disrupted businesses across the world.

Markets tanked after US President Donald Trump on Wednesday set curbs on travel from Europe to contain the pandemic, with the European Central Bank’s decision to hold back on rate cuts adding to the rout.

MSCI’s gauge of stocks across the globe dropped 9.51%, while Dow futures were down about 1% in Asia trading after suffering its worst crash on Thursday since Black Monday in 1987.

Investors even fled safe-haven assets like gold and bonds to cover their losses.

The blue-chip NSE Nifty 50 index was last down 10.07% at 8624.05 at 9:21am, on a more than three-year low. The S&P BSE Sensex was frozen at 29,687.52—down 9.43% or 3090.62 points compared to its previous close.

The BSE Sensex had plunged over 2919 points on Thursday in its biggest one-day fall in absolute terms as the coronavirus pandemic wreaked havoc on global markets.

The 30-share index settled 2919.26 points or 8.18% lower at 32,778.14 after nosediving over 3204.30 points during the day. Nifty gave up the 9600 level, slumping 868.25 points or 8.30% to close at 9590.15 on Thursday.

(With agency inputs)