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Indian Indices at 3 Year Lows: Sensex Cracks 5.6%; Nifty Ends Below 8,600 Mark
Wed, 18 Mar Closing | Monish Vora, TM Team

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It was another day of bloodbath on Dalal Street today. India share markets traded deep in the red as Sensex and Nifty hit a fresh 3-year low tracking negative trend seen in Asian markets.

Losses were seen amid heightened worries of COVID-19 virus outbreak.

The fall led to the market-capitalisation of BSE listed companies getting reduced to Rs 114.48 trillion, its lowest level since February 15, 2017.

Selling pressure was also seen as the Supreme Court in its hearing rapped telcos and the department of telecommunication (DoT) for going through self-assessment. The apex court questioned the Solicitor General on telcos' self-assessments without permission of the court, calling it a contempt of court.

At the closing bell, the BSE Sensex stood lower by 1,709 points (down 5.6%) and the NSE Nifty stood down by 425 points (down 4.8%).

The BSE Mid Cap index ended the day down 4.8%, while the BSE Small Cap index stood down by 6.1%.

All sectoral indices ended deep in the red with stocks in the telecom sector, banking sector and power sector witnessing maximum selling pressure.

The rupee was trading at 74.35 against the US$.

Asian stock markets finished on a negative note. As of the most recent closing prices, the Hang Seng was down by 4.18% and the Shanghai Composite was down by 1.83%. The Nikkei 225 was down 1.68%.

European markets were also trading on a negative note. The FTSE 100 was down by 4.61%. The DAX was trading down by 4.24%, while the CAC 40 stood down 4.57%.

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Here's what Richa Agarwal, our smallcap analyst at Equitymaster, has to say about the ongoing market crash and what it means for stock market participants...

  • a time when you see the Sensex and large cap stocks taking big knocks, you will be completely surprised at another feature of the market.

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And here's what Tanushree Banerjee wrote about the coronavirus pandemic and its effects on the global economy in today's edition of The 5 Minute WrapUp...

  • ...pandemics have had profound economic effects. But in the longer term, the economic effects can be positive.

    Is the assumption that Coronavirus could lead to such a massive social and economic change too farfetched?

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    And therefore, global manufacturers are bound to seek geographic diversification of resources and imports.

    That could mean a massive change in the way businesses are run.

Tanushree believes that the ongoing market crash could, in fact, be an inflection point for what she calls the irreversible Rebirth of India megatrends.

For bluechip stocks, she believes the time is ripe to begin buying some of the safest bluechips as there is safety in valuations and the market is offering them at deeper and deeper bargains.

The profits of bluechips (BSE 200 companies) are currently at a decade low as can be seen in the chart below.

A Rebound in Profits Overdue?

Tanushree is recommending her subscribers, to buy stocks selectively, a few at a time, by taking partial exposures to begin with. She has already recommended 4 safe bluechips in the past month and there are several more in her watchlist. You can access them here: Here's How You Could Trade the Coronavirus Crisis Safely (requires subscription)

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In the video below, Tanushree has also explained how buying the above stocks at bargain prices is a once in a decade opportunity.

In news from the aviation space, data released by aviation regulator DGCA showed domestic air passenger traffic in February increased by 8.98% to 1.236 crore as compared to the same period last year.

However, the rise in the number of domestic air passengers for January was just 2.2% when compared with the figures of the corresponding period in 2019.

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According to the Directorate General of Civil Aviation (DGCA) data, passenger load factors of all major airlines - Air India, SpiceJet, GoAir, IndiGo, AirAsia India and Vistara - increased in February as compared to January.

At 93%, SpiceJet saw the highest passenger load factor in February. At number two, GoAir had 90.5% load factor.

Passenger load factor measures the seat capacity utilisation of the airline.

SpiceJet's market share decreased from 16.6% in January to 15.3% in February, even as it retained the number two spot.

The market share of Air India, GoAir, AirAsia India and Vistara was 12%, 10%, 7.3% and 6.7%, respectively last month.

How this trend pans out in the coming months remains to be seen. Meanwhile, we will keep you updated on all the developments form this space.

Moving on to news from the commodity space, crude oil plunged Rs 116 to Rs 1,979 per barrel today amid weak trend overseas.

On the Multi Commodity Exchange, crude oil for March delivery slumped by Rs 116 or 5.54%, to Rs 1,979 per barrel.

Note that, crude oil prices had crashed last week in what was the worst price dip since the 1991 Gulf War with Brent prices plunging to US$ 31 per barrel.

In a recent article, we have written the entire timeline showing economics of falling crude oil prices. You can check the same here: All About the 30% Crash in Crude Oil - 10 Points

Going ahead, market participants are expecting crude oil prices to remain low until OPEC+ resets oil production again.

Vijay Bhambwani, editor of Weekly Cash Alerts at Equitymaster, states that at this point in time, short selling natural gas & crude oil at significantly higher levels for the coming summer are high conviction trades. To know more about his view and positions, you can check out his recent article here: Energy Markets Get Muddy (requires subscription).

From the banking sector, IndusInd Bank share price was in focus today as the stock of the lender crashed around 30% in today's trade on the back of rumors surrounding its financial health of the bank.

The bank has, however, provided an assurance that it has strong financials and healthy governance.

The bank in a press release said that in wake of the significantly higher level of market rumours and speculation around lnduslnd Bank stock, we would like to reiterate that the Bank is financially strong, well-capitalized, profitable, and a growing entity with strong governance.

The bank also sought to allay fears with regard to its asset quality and said that last quarter, the bank's gross NPA at 2.18% was the 2nd lowest in the industry amongst large private sector Banks. It further added that it expects current quarter Gross NPA to be pretty much in line with that of last quarter.

Apart from IndusInd Bank, Yes Bank share price was also in focus today as the stock of the lender jumped 50% in early trade today. Buying was seen as the bank is all set to resume full banking services from 6 pm today.

Yes Bank CEO-designate Prashant Kumar said there are absolutely no worries on the liquidity front and that complete operational normalcy would be restored from 6 pm on Wednesday.

The private lender is also hoping to recover about Rs 85 billion from its loan defaulters in the coming financial year.

Kumar added that only a third of customers have withdrawn the entire amount of Rs 50,000 allowed during the moratorium.

On March 5, the RBI had imposed a moratorium on the private lender, restricting withdrawals to Rs 50,000 per depositor till April 3, in view of its poor financial health due to bad loans.

In one of the articles, we have written about the entire timeline of how YES Bank went from a stock market darling to a pariah. You can read the entire article here: How the YES Bank Collapse Unfolded - 10 Points.

And to know what's moving the Indian stock markets today, check out the most recent share market updates here.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary

What else is happening in the markets today? Dig in...

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Stock Market Updates

HUL at All Time High; BSE FMCG Index Up 5.8% (Today's Market)

Apr 7, 2020 12:10 PM

HUL share price has hit an all time high at Rs 2,399 (up 9.8%). The BSE FMCG Index is up by 5.8%. Among the top gainers in the BSE FMCG Index today are HUL (up 9.8%) and NESTLE (up 7.0%). The top losers include P&G HYGIENE (down 1.7%) and FUTURE CONSUMER (down 4.9%).

AUROBINDO PHARMA Surges by 11%; BSE HEALTHCARE Index Up 7.4% (Today's Market)

Apr 7, 2020 12:08 PM

AUROBINDO PHARMA share price has surged by 11% and its current market price is Rs 434. The BSE HEALTHCARE is up by 7.4%. The top gainers in the BSE HEALTHCARE Index are AUROBINDO PHARMA (up 10.5%) and DR. REDDYS LAB (up 10.7%). The top losers are GSK PHARMA (down 2.0%) and PIRAMAL ENTERPRISES (down 2.1%).

TATA STEEL Surges by 6%; BSE METAL Index Up 5.2% (Today's Market)

Apr 7, 2020 12:08 PM

TATA STEEL share price has surged by 6% and its current market price is Rs 272. The BSE METAL is up by 5.2%. The top gainers in the BSE METAL Index are TATA STEEL (up 6.3%) and JSW STEEL (up 9.1%). The top losers is NMDC LTD (down 1.0%).

PFIZER Surges by 7%; BSE HEALTHCARE Index Up 7.4% (Today's Market)

Apr 7, 2020 12:08 PM

PFIZER share price has surged by 7% and its current market price is Rs 4,340. The BSE HEALTHCARE is up by 7.4%. The top gainers in the BSE HEALTHCARE Index are PFIZER (up 7.0%) and SANOFI INDIA (up 5.4%). The top losers are GSK PHARMA (down 2.0%) and PIRAMAL ENTERPRISES (down 2.1%).

BAJAJ FINANCE Plunges by 5%; BSE 500 Index Up 4.8% (Today's Market)

Apr 7, 2020 12:06 PM

BAJAJ FINANCE share price has plunged by 5% and its current market price is Rs 2,278. The BSE 500 is up by 4.8%. The top gainers in the BSE 500 Index are GUJARAT ALKALIES (up 17.4%) and JINDAL STEEL & POWER (up 15.3%). The top losers are BAJAJ FINANCE (down 5.2%) and PVR LTD (down 5.5%).

Indian Indices End Lower, Manufacturing Activity Amid Lockdown, and Top Cues in Focus Today (Today's Market)

Apr 7, 2020 Pre-Open

Top cues to track in today's stock market session.

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Apr 7, 2020 12:23 PM