Sensex starts over 600 pts higher, pares gains

Equity benchmark Sensex jumped over 600 points in opening session on Wednesday after the government took drastic measures to combat COVID-19 outbreak with Prime Minister Narendra Modi announcing a complete lockdown of the country for 21 days.

Asian peers were also trading higher as authorities world over stepped up efforts to fight the pandemic.

However, concerns over the impact of worldwide lockdowns kept investors on edge, traders said.

After rallying 625.41 points, the BSE barometer gave up all gains to trade 157.91 points or 0.59 per cent lower at 26,516.12.

Similarly, the NSE Nifty was trading 30.30 points, or 0.39 per cent, down at 7,770.75.

Reliance Industries was the top gainer in the Sensex pack, rallying up to 7 per cent, followed by Nestle India, Tech Mahindra, HDFC, PowerGrid and HUL. On the other hand, IndusInd Bank, ITC, L&T and ICICI Bank were the top losers.

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In the previous session, the BSE benchmark closed 692.79 points or 2.67 per cent higher at 26,674.03, after a highly volatile trading session. Likewise, the NSE barometer settled 190.80 points, or 2.51 per cent, up at 7,801.05.

According to traders, investors are weighing the economic impact of the 21-day lockdown announced last night. In an unprecedented drastic measure to curb the spread of coronavirus, Modi said the lockdown will be in force from Tuesday midnight, as he announced a central allocation of Rs 15,000 crore to strengthen the health infrastructure to tackle the disease.

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According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, enforcement of the 21-day lockdown of the nation will be a major challenge. Ensuring supplies to all households is not going to be easy, but has to be done. The temporary shock to the economy will be huge.

Bourses in Shanghai, Hong Kong, Tokyo and Seoul rallied up to 5 per cent.

Stocks on Wall Street rallied up to 11 per cent in overnight trade.

Incessant foreign fund outflow also kept domestic market participants risk-averse, traders said.

On a net basis, foreign institutional investors sold equities worth Rs 2,153.35 crore on Tuesday, data available with stock exchanges showed.

Global oil benchmark, Brent crude futures rose 2.43 per cent to USD 27.81 per barrel.

The total number of active COVID-19 cases in India stood at 512 on Wednesday morning, as per health ministry log.

The number of global COVID-19 infections has shot past 4,20,000. Worldwide fatalities have topped 18,000.