As Omicron spread jolts markets, investors poorer by ₹11.23 lakh cr in 2 days
India’s benchmark Sensex rose more than 20 per cent in the first 10 months of this year, aided by Reserve Bank of India’s (RBI’s) efforts to pump funds into the economy and steady buying by millions of first-time investors.
The huge sell-off in the markets due to the Omicron variant of coronavirus has left investors poorer by ₹11.23 lakh crore in two days. The rapid spread of the heavily mutated strain prompted selling of equities ahead of year-end holidays.
Tata Steel Ltd. was the biggest drag on the NSE Nifty 50 Index which retreated 2.3 per cent as markets plunged 1,182.53 points to a low of 55,829.21 in early trade on Monday. It had tumbled 889.40 points or 1.54 per cent to close at 57,011.74 on Friday.
The market capitalisation of BSE-listed companies tumbled ₹11,23,010.78 crore to ₹2,52,79,340.30 crore in two days.
Investors' wealth had on Friday shrunk by over ₹4.65 lakh crore as markets suffered a heavy selloff following weak global trends and continued selling by foreign institutional investors.
“Markets are under tremendous pressure, a further 5%-6% decline is possible for the benchmark,” Vishal Wagh, head of research at Bonanza Portfolio Ltd, was quoted as saying by news agency Bloomberg.
Another market expert, Gaurav Garg, the head of research at Capitalvia Global Research Ltd, said that traders will be cautious going forward.
"The Indian benchmarks made gap-down opening today amid rising Omicron coronavirus cases worldwide. Traders will be cautious with continuous net outflow of foreign funds as Foreign Portfolio Investors (FPIs) have pulled out ₹17,696 from the Indian markets in December month so far," Garg told news agency PTI.
India’s benchmark Sensex rose more than 20 per cent in the first 10 months of this year, aided by Reserve Bank of India’s (RBI’s) efforts to pump funds into the economy and steady buying by millions of first-time investors. The measure’s gain of almost 120 per cent from the low of March 2020 is the most among countries with stock markets worth at least $1 trillion.