Home / Markets / Stock Markets /  Bloodbath on Dalal Street as Sensex posts biggest one-day fall

Indian stocks markets were hit today by another big selloff with benchmark Sensex registering its biggest one-day fall in absolute terms. The Sensex tanked 2,919 points to 32,778 - its biggest one-day point fall - tracking a crash in global equities after the coronavirus outbreak was termed a global pandemic by World Health Organization. Today's market fall wiped out 11.26 lakh crore of investor wealth in a day. The Nifty also crashed 8% to 9,633. Stunning the markets, US President Donald Trump suspended all travel to the United States from Europe, except from the United Kingdom, for 30 days starting Friday.

The India VIX index, commonly referred to as the fear index, surged 30% to 41.32, indicating nervousness among investors. Broader markets also were witness to this mayhem. BSE midcap and smallcap index slumped about 7.5% and 8.5% respectively.

"Today, Indian markets witnessed one of the worst single-day fall in recent times. The major reasons for this crash is the coronavirus scare with no confirmed news on how many could get affected due to the virus and no cure or vaccine available as yet. In the short run, margin calls and stop losses are triggering panic selling in the market which is creating a cyclical effect as this is further pushing the stock prices downwards," said Amit Gupta, co-founder and CEO of TradingBells.

"It is best for investors to stay away from this market for a while till the time the volatility settles and we can see some notable reversals," he added.

Leading the slump were banking stocks, with Nifty Bank index tanking about 8%. Banking heavyweights like ICICI Bank, HDFC Bank, Axis Bank and SBI fell between 7% and 12%.

"Recession fears have increased after WHO declared coronavirus a pandemic which forced investors to sell off risky assets. Fresh travel bans across nations is contributing to the fears that economic impact will be much larger than earlier estimates. RBI is expected to cut interest rate and announce additional liquidity before the scheduled meeting which is due next month," said Vinod Nair, head of research at Geojit Financial Services.

Reserve Bank of India may announce liquidity-boosting measures and ease repayment issues to sectors that have been disrupted by supply chains being broken down due to the coronavirus outbreak, Reuters reported citing sources.

The Indian rupee (INR) today crashed to near a record low against the US dollar in the backdrop of a global risk-off sentiment. The rupee today fell to as much as 74.34 per dollar to near its record low of 74.48, a level hit in October 2018.

After a nearly 1,500-point slide overnight, US stock market index Dow Jones Industrials today is set for another big selloff. Dow futures is down 5% or nearly 1,200 points.

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