Sensex, Nifty open in red amid coronavirus woes; Tata Motors, Hindalco top losers

Mumbai: Equity indices on Friday (February 28) continue to remain under pressure for the sixth consecutive day amid global cues with the Sensex down 1,071.62 points or 2.70% at 38674.04, while the broader Nifty also opened 319.80 points down or 2.75% at 11313.50. On the indices, the top losers included Tata Motors, Hindalco, Tata Steel, Bajaj Finance, Yes Bank, and Gail.

On Thursday, equity indices reeled for the fifth straight session, as the global markets grappled with fears of the coronavirus outbreak turning into a pandemic. The 30-share BSE Sensex finally settled 143.30 points, or 0.36 per cent, lower at 39,745.66, while the broader NSE Nifty fell 45.20 points or 0.39 per cent to end at 11,633.30. 

The Sensex has now lost 1,577.34 points in five days, while the Nifty has shed 492.60 points. ONGC was the top loser in the Sensex pack on Thursday, dropping 2.61 per cent, followed by HCL Tech, M&M, SBI, IndusInd Bank and ICIC Bank.

Meanwhile, global share markets were headed for the worst week since the depths of the 2008 financial crisis as investors ditched risky assets on fears the coronavirus would become a pandemic and derail economic growth.

Asian stocks tracked another overnight plunge in Wall Street`s benchmarks on Friday with the markets in China, Japan, and South Korea all posting heavy losses.

MSCI all-country world index fell 0.3% after 3.3% drop on Thursday. So far this week it has lost 9.2%, on course for its biggest weekly decline since a 9.8% plunge in November 2008. Wall Street shares led the rout as the S&P 500 fell 4.42%, its largest percentage drop since August 2011.

It has lost 12% since hitting a record close on February 19, marking its fastest correction ever in just six trading days while the Dow Jones Industrial Average fell 1,190.95 points, its biggest points drop ever.

The CBOE volatility index, often called the "fear index", jumped to 39.16 on Thursday, the highest level in about two years, well out of the 11-20 range of recent months. The index, which measures expected swings in US shares in the next 30 days, often shoots up to around 50 as bear market selling hits its heaviest although it approached 90 during the 2008-09 financial crisis.

In Asia, MSCI`s regional index excluding Japan shed 1.4%. Japan`s Nikkei gave up 3.3% on rising fears the Olympics planned in July-August may be called off due to the coronavirus. Australian shares dropped 2.8% to a six-month low while South Korean shares shed 2.1%.

Fears of a major economic slump sent oil prices to their lowest level in more than a year. US crude futures fell 1.6% to $46.35 per barrel, having lost 13.2% so far on the week, which would be the deepest fall in more than five years.

As investors flocked to the safety of high-grade bonds, US yields plunged with the benchmark 10-year notes yield hitting a record low of 1.241%. It last stood at 1.274%.

That is well below the three-month bill yield of 1.439%, deepening the so-called inversion of the yield curve. Historically an inverted yield curve is one of the most reliable leading indicators of a US recession.

In currency markets, the yen rose to a three-week high of 109.33 to the dollar and last stood at 109.40. The euro stood at $1.0993, having jumped over 1% in the previous session, the biggest gain in more than two years as investors wound back bets against the currency versus the dollar.

(With Agency Inputs)