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Sensex, Nifty close up after circuit break
The recovery came after major global markets were lifted by hopes that a US stimulus package could help limit the economic damage from the coronavirus outbreak.
The benchmark S&P BSE Sensex rebounded 1325.34 points to end at 34,103.48 and NSE Nifty 50 index rallied 365.05 pts to close at 9955.20 points after tumbling earlier in the session.
The recovery came after major global markets were lifted by hopes that a US stimulus package could help limit the economic damage from the coronavirus outbreak.
The stocks had recovered sharply in afternoon trading after a 10% crash in the main indices on coronavirus fears triggered a rare trading halt earlier.
The NSE Nifty 50 index jumped 3.98% to 9,971.25 by 2:13pm, while the benchmark S&P BSE Sensex was up 4.23% at 34,165.08.
The indexes swung wildly after trading resumed at 10:20am following a 45-minute halt.
“Global stocks have recovered, this is helping our markets. The 45-min breather gave people time to think and value buying emerged,” Siddhartha Khemka, head of retail research at Motilal Oswal Securities, was quoted as saying by news agency Reuters.
“US stimulus hopes have helped arrest losses for the moment,” Khemka said.
India’s volatility index was up 19.8% after surging 44% to its highest in over a decade.
The rupee reversed losses to trade about 0.56% stronger at 73.9. It had fallen to a record low of 74.5075 against the dollar earlier in the session.
Sentiment was bolstered as US lawmakers neared an agreement with the White House on an economic rescue package to deal with the fallout from the coronavirus impact. House Speaker Nancy Pelosi said she hoped to announce a deal on Friday.
MSCI’s broadest index of Asia-Pacific shares outside Japan clawed back earlier losses to trade a touch higher, while European and US stock futures were in positive territory.
“Markets are acknowledging that they are in the oversold zone so there is some buying support coming in,” Sujan Hajra, chief economist at Anand Rathi Securities, said according to Reuters.
Housing Development Finance Corp Ltd led the recovery in Mumbai, rising as much as 13.2% and on course for its best day in nearly a decade. HDFC Bank Ltd jumped 5.9%, following a 10% slide earlier in the session, while State Bank of India (SBI) surged 17%.
Sun Pharmaceutical Industries Ltd climbed 13.6% and was headed for its best day in more than eight years.
The Nifty Pharma index was last up 5.8% and the Nifty Bank Index 5% 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)
