Markets end in red: Sensex plummets 2,002 points, Nifty suffers heavy loss of over 560 points; ICICI Bank top loser

After posting a 7 percent gain in just four sessions of the previous week, the stock markets erased most of the gains in the first session of this week. Brutal selling was witnessed across counters amidst subdued global cues over rising tensions between the US and China over coronavirus. Weak earnings by large companies like Reliance, Hindustan Unilever and Tech Mahindra and the implementation of economic lockdown 3.0 also weighed on sentiments. Sensex plummeted 5.94 percent or 2,002 points on Monday, tracking massive selloffs in global markets amid rising US-China tensions. After a highly volatile session, the 30-share BSE index settled at 31,715.35, plunging 2,002.27 points, or 5.94 per cent. Similarly, the broader NSE Nifty suffered a heavy loss of 566.40 points, or 5.74 percent, to settle at 9,293.50. Selling accelerates post-PMI data Selling got accelerated after India’s manufacturing PMI for the month of April reduced to a record low of 27.4. While all sectorial indices ended deep in the red except pharma, sharp correction was seen in the banking and financial stocks. The market ended the session with the loss of 5.7 percent and the Nifty bank declined by 8.0 percent. Only Sun Pharma, Cipla and Bharti Airtel managed to end the session in green in Nifty 50, while seven stocks including ICICI Bank, HDFC ended with a loss of 10 percent. The released PMI data, government’s measures to combat the impact of lockdown extension and the brewing US-China relationship could impact markets this week. ICICI Bank was the top laggard in the Sensex pack, sinking over 10 percent, followed by Bajaj Finance, HDFC, IndusInd Bank, Axis Bank and Maruti. Shares of Reliance Industries fell over 2 percent after the oil-to-telecom conglomerate on Thursday posted its biggest ever drop in quarterly net profit. Its net profit in January-March dropped 37 percent to Rs 6,546 crore, the lowest in three years. [caption id=“attachment_8134681” align=“alignleft” width=“380”]  Representational image. Reuters.[/caption] Meanwhile, earlier in the day, Silver Lake—one of the world’s largest tech investors-agreed to invest Rs 5,655.75 crore to buy a 1.15 percent stake in Jio Platforms. Bharti Airtel and Sun Pharma were the gainers in the BSE index. Indian equity indices broke a four-day winning streak and recorded their biggest one-day fall in over a month reflecting the weakness in global markets over the last two trading sessions. Weak global cues, poor macro data locally, the latest US China spat and poor corporate earnings led to this fall. The NSE Nifty 50 index gave up half of the gains made during the previous week, ending at 9,293, down 5.7 percent. Asian stocks slid on Monday, as tensions rose between the US and China over the spread of the coronavirus pandemic. European stock markets and oil prices fell on Monday as a spat between top U.S. officials and China over the origin of the coronavirus fuelled fears of a new trade war, derailing a rebound in global markets. Deepak Jasani, Head Retail Research, HDFC Securities said: “Banks and Tata Motors came under pressure after Fitch cut their ratings. Metals and auto stocks also bore the brunt of selling pressure. “Factory data around the world paints a historically grim picture of April output, with European PMI levels falling to all time low of 33.4 in its 23-year history. India’s manufacturing activity slumped to a record low in April as business activities came to a near standstill after the Centre imposed a nationwide lockdown to contain the spread of COVID-19. The Nikkei manufacturing Purchasing Managers’ Index (PMI) for India declined to 27.4 in April from 51.8 in March, recording the sharpest deterioration in business conditions since data analytics firm IHS Markit began recording data 15 years ago. “Technically the Nifty has given a bearish signal by forming a bearish island reversal pattern after a rise. The next support to look forward to is at 9,132, while the resistance is at 9,392. The ultimate targets of the bearish pattern is at 8,909-mark,” said Jasani. Sumeet Bagadia, Executive Director, Choice Broking said, “On back of global cues, the index gave a gap-down opening and continued its downside movement till the last meeting of trading session. The Index settled at 9,293-level with the loss of 566 points along with its large constituents which also got the bad hit during the trading sessions. Private bank, financial services and metal stocks were the top losers sector which closed in red with 8 percent down move. At present level, the Index has strong resistance at 9,450 while downside good support comes at 9,170-9,000 levels,” he said. Rupee plunges The Indian rupee depreciated by 64 paise to settle at 75.73 (provisional) against the US dollar on Monday tracking heavy selloff in domestic equities and a strengthening greenback overseas. Traders said the weakness in the local unit was largely due to heavy correction in domestic equities and strengthening of the US dollar. Moreover, rising coronavirus cases in the country also weighed on the local unit, they said. The rupee opened weak at 75.70 at the interbank forex market and then lost further ground to finally end at 75.73, down 64 paise over its last close. During the day the domestic unit saw an intra-day high of 75.65 and a low of 75.80.

#Rupee ends lower Vs Thursday's closing pic.twitter.com/B303LOVIA7

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It had settled at 75.09 against the US dollar on Thursday. Forex market was closed on Friday on account of Maharashtra Day. Domestic bourses were trading with significant losses with benchmark Sensex down 1,891.69 points at 31,825.93 and Nifty lower by 540.75 points at 9,319.15. The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose by 0.27 percent to 99. Fuel sales decline by 50% from a year ago Fuel consumption slumped by close to 70 percent in April as all petroleum products except LPG saw massive demand erosion following a nationwide lockdown halted economic activity and travel. But demand has shown signs of pick up in the last 10 days of April after the government allowed resumption of economic activity beyond the urban municipal limit, industry data showed. The demand is expected to further pick up as more areas were opened up on Monday. According to provisional industry data, petrol sales by public sector firms were down 64 percent in the first half of April but ended the month with a 61 percent fall after some up trend in the second half. Similarly, diesel sales slumped 61 percent in the first half but ended with 56.5 percent lower sales for the month. Overall, petrol sales came in at around 8,70,000 tonnes in April, down from 2.23 million tonnes in the same month a year back. Diesel consumption was down to 2.84 million tonnes from 6.56 million tonnes in April 2019. Aviation turbine fuel (ATF) consumption collapsed by 91.5 percent as most airlines have stopped flying. The only fuel that showed growth was LPG as the government dole of free cooking gas cylinders to poor households fired up consumption by 12 percent to 2.11 million tonnes in April, the data showed. Overall the decline in petroleum product sales was about 70 percent. --With agency inputs