Indian stock markets witnessed bloodbath on Monday as the cases of COVID-19 continue to rise in India and several state governments ordering shutdowns of malls, theatres, etc.
On the Bombay Stock Exchange (BSE), the Sensex lost over 2,800 points (8.2% down) to 31,302.60 as of 3 15pm on Monday as against a previous close of 34,103.48. It opened at the day's high of 33,103.24 and has so far touched an intra-day low of 31,460.72.
On the National Stock Exchange, the Nifty was down by 782.85 points at 9,172.35.
On the Sensex, the stocks that fell the most were IndusInd Bank (-16.31%), Tata Steel (11.80%), Axis Bank (-10.91%), ICICI Bank (10.5%) and Tech Mahindra (8.53%).
Not just India, the Asian and European indices too saw major freefall even after the US Federal Reserve announced a second emergency rate cut.
The number of coronavirus cases in India rose to 110 on Sunday. Maharashtra has reported the highest number of cases followed by Kerala. Two deaths have been reported till date, a 76-year-old man in Karnataka's Kalaburagi and a 68-year-old woman in New Delhi.
The World Health Organisation (WHO) has declared COVID-19 a pandemic.
With the markets witnessing a freefall for over a week now, the Reserve Bank of India has said that it will address media at 4pm on Monday. It is expected that the central bank would follow its global counterparts and announce an emergency rate cut.
Experts have pointed-out that a conducive rate cut scenario has been built with both CPI and WPI rates declining in February.
Last month's retail inflation has shown a decline to 6.58 per cent from January's 7.59 per cent.
However, the retail inflation level continued to remain much above the RBI's medium-term target for the CPI rate of 4 per cent with a band of +/- 2 per cent.
"Even as RBI's 4QFY20 inflation forecast of 6.5 per cent will likely be overshot by ~25-35bps, latter half of the year will see substantial correction in inflation, much below the 4 per cent target," Edelweiss Securities' Lead Economist Madhavi Arora told IANS.
According to Karan Mehrishi, Lead Economist at Acuite Ratings and Research: "We believe an out of turn rate cut is possible to the tune of 50 bps. This is part of a global consolidated effort by central banks led by the Us Federal Reserve to calm the markets, as sovereign and high rated debt is experiencing yield spikes."
"Coronavirus threat can be seen as a trigger point behind the move."
With IANS inputs