One, two, three and the March of Doom; Sensex tanks 2,713 points

The bloodbath in Dalal Street continued on Monday as Indian shares now have marked their three biggest losses ever in the span of just five trading sessions. Today’s loss happens to be the second-biggest loss.

The 30-share index of BSE – Sensex – plunged 1,841 points (5.4%) to 32,262 within minutes of trade on– shredding all of the gains made on Friday.

The sell-off worsened in the afternoon, European Markets – which have been worst hit by the spread of Coronavirus – opened coupled with the Reserve Bank’s announcement of emergency presser at 1600 hours today. The Sensex marked its second worst-ever loss in history and tanked 2,713 points (7.96%) to 31,390.

With this Sensex has lost now lost 10,669 points in a span of less than two months (25.4%).

Follow today's developments on the stock markets here

As the markets tumbled, investors lost yet another Rs 4 lakh crore in today’s bloodbath.

The overall market breadth was also largely negative – with just 419 advances against 2,027 declines.

All the stocks on Sensex, led by IndusInd Bank (18.16%), traded in deep red. The banking stocks in the markets were worst hit, over concerns on the stability of the Indian financial system.

On the other hand, broader index – 50-share NSE Nifty – continued trading below the psychological 10,000-mark. The Nifty plunged to 9,426, down 529 points (5.4%) in the first few minutes of trade.

Nifty closed the day’s trade at 9,199, down 756 points (7.60%).

Foreign investors started pulled out their monies and parked them in safe havens like gold and US Treasury Bills. As foreign fund pull-out continued, rupee 60 paise to 74.34.

With just 15 days of this month over, foreign fund pull out in the Indian equity markets has reached unprecedented levels. FII has withdrawn Rs 30,334.30 crore from the Indian markets -- a level that wasn't even seen at the peak of the 2008 recession. In January 2008, FIIs had withdrawn Rs 29,447.51 crore.

With this, both Nifty with losses of 26% and Sensex with losses of 25% over the past two months have continued to be in a bear market. The index should lose 20% or more from the life-high to be termed as a bear market. The equity investors have lost about Rs 35 lakh crore in the past two months, and all the gains made since April 2017 have been wiped off.

All the indices across BSE and NSE traded in deep red, with bank stocks, after the collapse of YES Bank, being the worse hit. The Nifty Bank crashed by 8.29%, with only Nifty metal crashing more than it (8.9%).

On the other hand, the India VIX, which measures volatility in the Indian shares, rose by yet another 16% during the day as indices tumbled.

"As expected the markets are pricing g in the uncertainty surrounding Covid 19 - what is surprising is lack of interest in usual safe haven assets," said Anubhav Srivastava of Infinity Alternatives.