Nifty, Sensex rattled by US crude plunge; oil stocks crash, ICICI shares drop second straight day

The benchmark indices dropped sharply on Tuesday, tracking losses in global markets, following a historic overnight plunge in US crude oil that amplified the blow to the world economy from the coronavirus-led lockdowns.

#CNBCTV18Market | Indian market opens with cuts following weak global cues and historic fall in crude pic.twitter.com/SXUDbolIst

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Sensex plunged over 1,000 points in opening trade on Tuesday tracking heavy losses in banking, energy and IT stocks amid volatility in global market as international crude oil prices went into a tailspin overnight. The NSE Nifty 50 index fell 2.85 percent to 8,999.95 while the benchmark S&P BSE Sensex was down 2.84 percent at 30,747.13. “Investors braced for further cues on the economic toll from the coronavirus in a week lined with corporate earnings and data this week,” Reliance Securities said in a research note, PTI said. According to Reliance Securities, “rupee could track domestic equity markets, which could track a fall in Asian equities” “Asian equity markets could track a fall in Wall Street after US crude futures turned negative for the first time in history, weighed down by the collapse in oil demand as the coronavirus pandemic derails the global economy,” the Reliance Securities note added. Oil stocks, ICICI crash Oil-to-retail conglomerate Reliance Industries Ltd was the biggest drag on the indexes, falling as much as 3.5 percent. The losses were broad-based, with the Nifty Bank Index plunging 4.2 percent, its most since 3 April. Private-sector lender ICICI Bank Ltd fell for the second straight day, tumbling 6.2 percent. [caption id=“attachment_5263731” align=“alignleft” width=“380”]  Representative image. Reuters[/caption] West Texas Intermediate futures bounced back into positive territory on Tuesday after plunging below zero, but were still just $1.76 a barrel. MSCI’s broadest index of Asia-Pacific shares outside Japan fell half a percent, while the Dow Jones Industrial Average ended 2.44% lower and the S&P 500 lost 1.79% overnight. After hitting a low of 30,634.41, the 30-share index was trading 822.45 points or 2.60 per cent lower at 30,825.55. Similarly, the NSE Nifty tanked 235.05 points, or 2.54 per cent, to 9,026.80. In the previous session, the BSE barometer ended 59.28 points or 0.19 percent higher at 31,648, while the Nifty was down 4.90 points or 0.05 per cent at 9,261.85. Maruti was the top laggard in the Sensex pack, sinking up to 7 percent, followed by Tata Steel, IndusInd Bank, Bajaj Finance, Axis Bank, ICICI Bank and ONGC. On the other hand, Sun Pharma, Nestle India, HUL, Asian Paints and ITC were the gainers. Foreign portfolio investors were net sellers in the capital market on Monday, as they offloaded equity shares worth Rs 265.89 crore, according to provisional exchange data. According to traders, domestic market plunged following selloff in global equities as rout in crude market hit investor sentiment world over. Wall Street crashes With space to store oil scarce, US benchmark West Texas Intermediate (WTI) for May delivery plunged to -$37.63 a barrel ahead of Tuesday’’s close for futures contracts – when traders who buy and sell the commodity for profit would have had to take physical possession of it. US oil prices rebounded back above zero on Tuesday. WTI crude for May delivery was changing hands at $0.56 a barrel in New York. On Wall Street, stocks crashed after US oil prices turned negative on Monday for the first time ever. Bourses in Shanghai, Hong Kong, Tokyo and Seoul were trading with heavy losses in early deals. Further, concerns over mounting COVID-19 cases also kept investors jittery, traders said. The death toll due to the pandemic rose to 590, while the number of cases in the country climbed to 18,601. Global tally of the infections has crossed 24.7 lakh, with over 1.70 lakh deaths. Rupee plummets 30 paise to 76.83 against US dollar in early trade The Indian rupee depreciated by 30 paise to 76.83 against the US dollar in opening trade on Tuesday, tracking weak domestic equities and strengthening of the US dollar overseas. Forex traders said the rupee opened on a weak note as the US Dollar edged higher past the 100 level mark. The rupee opened weak at 76.79 at the interbank forex market and then fell further to 76.83, down 30 paise over its last close. The rupee had settled at 76.53 against the US dollar on Monday. Crude futures collapse WTI crude oil futures collapsed to negative, while Brent crude futures, the global oil benchmark, fell 0.78 per cent to USD 25.37 per barrel. Moreover, market participants are also concerned that the sharp rise in coronavirus cases, could weigh on the economy. The number of cases around the world linked to the new coronavirus has crossed over 24.81 lakh. In India, nearly 18,600 coronavirus cases have been reported so far. Foreign institutional investors (FIIs) were net sellers in the capital markets, as they sold shares worth Rs 265.89 crore on Monday, as per provisional data. The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose by 0.20 per cent to 100.15.