Sensex Tanks 1708 Points On Rising Covid Concerns, Bajaj Finance And IndusInd Bank Top Drags

The Indian bourses posted their second-highest single-day fall as they nosedived on Monday, April 12 tracking declines in index-heavyweights such as HDFC Bank and Reliance Industries. The BSE index slipped 1400 points in the early market trade and continued to extend losses to close lower by 1700 points as selling pressure across the board weighed the index to plunge majorly.  

The frontline S&P BSE index marked losses in 29 of its constituents and closed lower by 1707.94 points at 47,883.38, down 3.44 per cent. IndusInd Bank and Bajaj Finance were the top contributors in the Sensex pack as they slipped over eight per cent each on Monday. The key index Nifty-50 closed lower by 524.05 points at 14310.80. 

Rising Covid-19 cases in the country coupled with a shortage of vaccine supply in states spooked the investor sentiment on Monday. Further, concerns over restrictions and lockdown imposed in the economically significant state of Maharashtra also added to worries about the economic recovery among the investors.

"The situation is the worst in economically significant Maharashtra. This can impact the market's assumption of around 11 per cent GDP growth and above 30 per cent earnings growth", said VK Vijaykumar of Geojit Financial Services. 

Tracking the global peers, Asian markets were also trading mostly red on Monday, while the Singaporean Exchange was trading lower by over three per cent at the time of filing.  

In the domestic trading, Tata Motors and Adani Ports were the top drags for the index as they plunged nearly 10 per cent in the day's trade. Further, PSU bank stocks declined heavily in the market as Indian Bank and Canara Bank slipped over 11 per cent in the session. The overall Nifty PSU Bank index declined over nine per cent.  

All sectors closed red on Monday as selling was seen throughout the day across the board. Auto, Financials, and Metal sector slipped five per cent each in the intraday session. Shares of Tata Motors fell nearly 10 per cent in the Auto pack.  

The previously outperforming broader markets BSE Midcap and Smallcap also witnessed higher pressure than the benchmarks today and closed down by over 1000 points. BSE Midcap closed down by 5.32 per cent, and Smallcap index closed down by 4.81 per cent. Shares of BHEL and Shriram Transport Finance were top losers in the Midcap space as they fell over 11 per cent each.  

On the flipside, Dr. Reddy's Labs (+4.97 per cent), Cipla (+2.19 per cent), and Divis labs (+0.73 per cent) bagged the top gainers of the market.  

In the overall market breadth, around 2433 shares declined, 493 shares advanced, and 171 shares closed unchanged.  

Analysts feel that the sharp downside in the rupee against the dollar and fears of lockdown in few states where cases are rising very fast is leading to selling in the market and the volatility can be seen in the upcoming sessions too.  

"In the worst case, Nifty50 can re-test the January 2021 low of 13,600 or go to 13,000. The likely strong earnings growth could restrict any major downside in the market going ahead", said Rusmik Oza - Executive Vice President and Head of Fundamental Research at Kotak Securities.