‘Fear’ factor pulls down indices

Our Bureau Mumbai | Updated on May 19, 2020

The stock markets, on Monday, were indifferent to the buoyancy in other bourses around the world and the Centre’s decision to open up the defence, coal and power sectors to incremental FDI flows.

The Sensex was down 1,068 points or 3.44 per cent at 30,028. The Nifty index was down 313 points or 3.43 per cent at 8,823 points. The Bank Nifty index crashed 6.69 per cent or 1,260 points at 17,573. The rupee recovered marginally by 0.16 per cent at 75.69 against the dollar.

On Monday, index futures in the US and Europe were trading higher between 1.5 and 2 per cent but foreign portfolio investors (FPIs) continued selling stocks and creating further short positions for the fifth day in a row. Overall, FPI selling has touched nearly ₹29,000 crore in the past five days.

“There is a madness of risk-off trade in India. Some measures in the package announced were undoubtedly good. But large traders are scared that India would still see negative growth as demand will take time to return,” said Amar Ambani, Senior President and Head Research, Institutional Equities, Yes Securities.

Markets were expecting tax incentives for stock traders in the stimulus package, but the government has focussed its spending only on the real economy, which will have its impact in the months ahead, experts say. Gold futures had crossed ₹47,000 on the MCX.

Published on May 18, 2020

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