BackSensex slumps nearly 1450 points. Should you buy into today's decline?
The Nifty financial and Nifty Bank indices were down over 3%.
PremiumEquity benchmark Sensex tumbled over 1,400 points in the morning session on Monday, dragged by massive losses in financial stocks amid concerns over spiking COVID-19 cases in the country. Financial stocks were under strong selling pressure. The Nifty financial and Nifty Bank indices were down over 3%.
India reported a record rise in COVID-19 infections in past 24 hours with over 1 lakh cases in a day. Maharashtra, India's richest state and home to its commercial capital Mumbai and numerous industries, reported a record 57,074 new cases overnight. The state also announced new restrictions to curb to the spread of the virus.
Asian stock markets were mixed mixed today after Wall Street hit a record high last week. S&P 500 index rose had closed above 4,000 points for the first time. Friday's job data in US also were better than expected. The Indian rupee today slumped 73.43 against the US dollar.
Here is what analysts said on today's market slump
Gaurav Garg, Head of Research at CapitalVia Global Research Limited
"Market opened on a flat note following the mixed sentiments in the markets but could not maintain the higher levels and tumbled below 14500. The increase in the corona cases has led to the negative sentiments in the domestic market. On the other hand, US markets closed higher as the unemployment rate has fallen to 6%. Asian market was mostly trading in green following the US markets and positive overall sentiments. We can expect a recovery in the Indian market as well and the market can be expected to be in the range of 14350-14900 in the coming week."
Hemang Jani, Head Equity Strategy, Broking & Distribution, Motilal Oswal Financial Services
“Over the weekend the cases crossed 1 lakh mark in covid cases in nation. Of this, bulk of the cases are in Maharashtra where 2nd lockdown has been put in place till Apr 30, though it’s not a complete lockdown. Market over the next few days would monitor as to how the situation pans out in Maharashtra and also in other states especially 8-10 other states where the covid cases is rising rampantly. Apart from this the Q4 numbers would start pouring in from mid-April with Infosys and Wipro being among the first ones to declare. We are expecting strong 4QFY21 numbers for the IT sector and expect robust FY22 outlook from the management despite cost pressures. Overall we believe IT and Metals to fare better in comparison to other sectors given the cost pressures faced during the Q4. Thus the month of April is likely to be highly volatile with Q4 earnings, rising covid cases and higher bond yields to determine the trend."
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