Investors also battled concerns about a resurgence of Covid-19 cases in European cities that led to further restrictions. Poor economic data from Western countries also hurt sentiments at home.
At 9.25 a.m. M., BSE’s flagship Sensex was down 531 points or 1.41 percent to 37,137, while the benchmark NSE Nifty index plunged 166 points or 1.49 percent to 10,966, falling below the 11,000 level for the first time since August 4. All sectors experienced a sell off. .
India VIX, the measure of volatility in the market, advanced 5.45 percent to 22.13.
In the Sensex 30-share package, Power Grid was the sole winner, up 0.15 percent to Rs 164.15. On the other hand, Bajaj Finance was the biggest loser, with a decrease of 3.05%. It was followed by M&M, IndusInd Bank, Maruti Suzuki, Axis Bank and Tata Steel, which fell 2-3 percent.
The broader market indices were worse than their major peers, as Nifty Smallcap fell 2.03%, while Nifty Midcap fell 1.63%. The broadest NSE index, the Nifty 500, was down 1.50 percent.
These are the main factors that drive the markets:
Investors wondered if they had overstated the global economic recovery, as US Federal Reserve Vice Chairman Richard Clarida said on Wednesday that the US economy remains in a “deep hole” of unemployment and weak demand, and called for more fiscal stimulus, noting that policymakers “aren’t even going to start thinking” about raising interest rates until inflation hits 2 percent.
The president of the Federal Reserve Bank of Cleveland, Loretta Mester, echoed Clarida, saying that the United States remains in a “deep hole, regardless of the comeback we have seen.” These comments made investors around the world nervous.
MSCI’s broader Asia-Pacific stock index outside of Japan fell 1.35 percent in the morning session on overall losses in the region.
Chinese stocks fell 1.09 percent, Hong Kong’s Hang Seng fell 1.72 percent, Seoul’s KOSPI plunged 1.73 percent and Australian stocks were down 1.18 percent. Japan’s Nikkei fell 0.74%.
On Wednesday, the Dow Jones Industrial Average fell 1.92%, the S&P 500 lost 2.37% and the Nasdaq Composite fell 3.02%.
- Macro numbers put more pressure
US business activity cooled in September, with gains at factories offset by a decline in services. Investors are now awaiting the weekly data, which is expected to show that jobless claims in the United States fell slightly but remained elevated.
Across the pond, euro zone business growth came to a halt this month as the service industry reversed, hit by a resurgence of COVID-19 cases that prompted governments to reintroduce restrictions, a survey showed.
Countries like the UK, France, Spain and the Netherlands are seeing virus hotspots reappear that may lead to further restrictions on movement and businesses, investors fear. India also reports close to one lakh of cases per day, with the current patient count at 57.3 lakh.
The number of coronavirus-related deaths worldwide has exceeded 9.75 lakh, according to the Johns Hopkins University tracker, which is based on official government data. More than 91,000 people in India have died from the virus.
If deaths continue to occur at roughly the same rate, the world will have suffered a million deaths before October 1, or within the next week.
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