Sensex bleeds 10,000 points in 2 months

The benchmark Indian index 30-share BSE Sensex has now crashed by over 10,000 points in just the past two months as shares have been in the complete grip of the bears.

On Monday, the Sensex, which has now marked its top three losses in a span of five trading sessions, closed at 31,390.07, down 10,563 points (25%) over its all-time closing high of 41,952.63 points on January 14, 2020.

Similarly, the broader index 50-share NSE Nifty has crashed by 3,164.9 points (26%) now to 9,197.40 from its all-time closing high of 12,362.3 points on January 14.

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.

With this, the slipover of the bloodbath is expected to slipover to the economy, as stated by the Reserve Bank Governor Shaktikanta Das. In the US, the spillover has started to happen, with JP Morgan prediction two-quarters of contraction in the American economy -- essentially a recession.

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.

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 the emergency presser. The Sensex marked its second worst-ever loss in history and tanked 2,713 points (7.96%) to 31,390.

As the markets tumbled, investors lost yet another Rs 7.7 lakh crore in the 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 tanked by 49 paise to close at 74.23 against the US dollar.

With net withdrawals of Rs 3,810 crore by foreign funds in India today, the FII pull-out in 10 trading sessions this month surges to Rs 34,144 crore -- almost Rs 5,000 crore more than the second-highest pull-out of Rs 29,400 crore in January 2008.

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.

On the other hand, SGX Nifty, which closes at 2330 hours IST, was trading at a loss of 10.62% -- hinting at a further bloodbath on Tuesday.

In the US, as the Dow 30 commenced the trade, it crashed by 2,250.46 points (9.71%) to 20,935.16 -- triggering a circuit breaker for the third time this month.