oppn parties There Is No Silver Lining For The Stock Markets

News Snippets

  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
  • India has moved to the 40th spot in the innovation index, up 6 spots from last year
  • DGGI has alleged that top insurance companies, banks and NBFCs has committed a fraud of Rs 800cr by claiming input tax credit without underlying supplies
  • The Centre will borrow Rs 10000cr less than planned earlier due to good revenue collections
  • At $23.9bn, India's current account deficit widened to 2.8% in Q1, the worst in four years
  • Stocks continue to flounder on Thursday: Sensex sheds 188 points to 56409 and Nifty 40 points to 16818
  • The 36th National Games were declared open on Thusrday by PM Modi in front of a record crowd in Motera near Ahmedabad
  • Jasprit Bumrah most likely to miss T20 World Cup due to recurrence of back injury
  • PFI's political wing, the SDPI is on EC radar and action will follow soon if discrepancies are detected
  • Ashok Gehlot to meet Sonia Gandhi today, says all issues will be sorted out soon
  • Referring to the PFI ban, most Muslim organizations ask the government to take similar action against right wings organizations like the RSS, Bajrang Dal, VHP and the like
In a landmark order, Supreme Court rules that all women, married or unmarried, are entitled to safe and legal abortion up to 24 weeks of pregnancy as per the MTP Act
oppn parties
There Is No Silver Lining For The Stock Markets

By Ashwini Agarwal
First publised on 2020-03-18 20:40:47

Indian stock markets continued their downward slide in tandem with markets across the globe. On Wednesday, the Sensex fell by 1709 points while the Nifty was down by 498 points. Ever since Covid-19 was declared a pandemic, markets the world over have been in a freefall anticipating complete disruption of business activities and global recession due to the lockdown in many countries. The Indian economy was in the doldrums even before coronavirus struck and the market sentiment was bearish. But the pandemic has resulted in huge selling pressure as foreign investors have started liquidating their holdings and there is panic selling by small investors. Indian institutions have made purchases but the quantum and the frequency are declining rapidly.

In the last one month, Indian markets have eroded immense investor wealth. More than Rs 50 lakh crore of investor wealth has vanished and the market capitalization is at its lowest in three years. The worst thing is that there is no silver lining. After the Indian markets closed on Wednesday, there was a bloodbath in the US markets. The Dow Jones opened 1700 points lower. In percentage terms, the US markets shed between 5 to 7 percent in opening trades. The US administration has sought emergency funding of $850 billion to $1 trillion to fight coronavirus. Since Indian markets are sensitive to the happening in other world markets, there is likely to be another steep fall tomorrow.

Is the panic misplaced? Are markets overreacting to the situation? The answer is a firm no. There is no guarantee when the pandemic will be brought under control. It is surfacing at newer destinations every day. Europe is firmly in its grip. The Middle-East is showing signs of becoming badly infected. India has controlled it until now but experts warn that there might be many asymptomatic cases lurking in the alleys and can make the situation worse. Oil prices are also in freefall, breaching the $27 level today, suggesting that there is lesser demand due to pause in economic activity. The market has not bottomed out yet. Investors will be well advised to hold their horses and not trade based on unsolicited advice.