Covid fears erode INR 4.4 trillion wealth | Jobs Vox


MUMBAI : Spooked by concerns over a possible resurgence of Covid cases and ahead of the release of the latest minutes of the Monetary Policy Committee meeting, Indian stock indices fell by more than one percent, wiping out 4.4 trillion of investor wealth in the bargain.

The Nifty fell 186.20 points to close at 18,199.10, while the Sensex fell 635 points to end at 61,067.24 after markets appreciated the full import of the Centre’s advice to step up genome sequencing to identify fresh strains of covid that are spreading from China.

Minutes of the MPC meeting held on 5-7 A December report released after the market closed showed the Reserve Bank of India governor voting against a pause in interest rate hikes on the grounds that it was premature.

Investor apprehension underscores the rise of the India Vic Fear Index by a whopping 12.93%, the highest in six months, to 15.56. A rise in Vic reflects uncertainty and increasing bearishness, while a fall implies increased optimism.

Foreign institutional investors sold shares worth provisionals 1,119.11 crore though domestic institutional investors bought provisionals 1,757 crore shares. The rupee fell 6 paise to 82.81 against the dollar.

Media, financial and metal stocks bore the brunt, while healthcare, consumer goods and IT stocks rose on renewed fears of a resurgence of the pandemic.

UltraTech Cement, Bajaj Finserv, IndusInd Bank, Adani Ports and Adani Enterprises were the biggest movers on the Nifti, falling between 2% and 6.32%. Sun Pharma was the top gainer, up 1.67%, followed by HCL Tech, Tech Mahindra, TCS and Nestle India. The indices of medium and small capital were below the reference indices, falling by 1.58% and 2.24%.

“This was a knee-jerk reaction to fears of a new outbreak in China and its likely fallout,” said Siddhartha Kemka, head of research (retail), Motilal Oswal Financial Services. “I expect 18,000 to be strong support as long as the situation is considered under control over the next few days.”

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