Sensex Tumbles Nearly 900 Points On Coronavirus Fears, Yes Bank Crisis

The stock markets tumbled more than 2 per cent on Friday as the double whammy of rapidly-spreading coronavirus and Yes Bank crisis spooked the investing community. The deadly Covid-19 virus, which has infected more than 95,000 people in around 60 countries across all continents, except Antarctica, is stoking fears of recession in the global economy. RBI's action of seizing control of the beleaguered Yes Bank and possible ramifications on the financial system also dented sentiment on Dalal Street. The BSE Sensex ended at 37,576, lower by 894 points - or 2.3 per cent - and the NSE Nifty closed at 10,989, down 280 points - or 2.5 per cent. This marks the lowest levels in over 5 months.

The broader markets also succumbed to panic selling, with the BSE Midcap and Smallcap indices down 2.3 per cent and 1.9 per cent respectively. The midcap and smallcap segments had declined 4.16 per cent and 3.25 per cent respectively in early trade.

The S&P BSE Sensex index had nosedived as much as 1,459.52 points to hit 37,011.09 on the downside in the first few minutes of trade and broader NSE Nifty benchmark dropped to a low of 10,827.40, down 441.60 points from the previous close. The markets, however, trimmed part of their losses towards the close of trade.

Yes Bank shares plummeted 56 per cent to Rs 16 a day after the Reserve Bank of India (RBI) suspended the private sector lender's board for a period of 30 days "owing to serious deterioration in the financial position of the Bank" and imposed a withdrawal limit of Rs 50,000 on its account holders, with few exceptions, till April 3. The shares had hit a low of Rs 5.5 earlier in the day.

Meanwhile, Finance Minister Nirmala Sitharaman assured depositors that there will be no loss to any Yes Bank depositor. And RBI Governor Shaktikanta Das said, "We will take swift action... And we have a scheme in place to revive Yes Bank." The decision on Yes Bank was taken at a "larger level" and not at individual entity level, and was aimed at ensuring the safety of financial system, RBI governor said further. The RBI governor also assured, "RBI stands ready to intervene in whatever way required to respond to epidemic challenges".

Equities in other Asian markets fell, with MSCI's broadest index of Asia-Pacific shares outside Japan last seen trading 0.5 per cent per cent lower. Japan's Nikkei 225 index was down 1.4 per cent at the time, while Hang Seng, Straits Times, SET Composite and Jakarta indices were down between 1 and 3 per cent each.

It was bloodbath across the Street. Banking stocks took it on the chin, with SBI, IndusInd Bank, HDFC, ICICI Bank and Axis Bank shedding 2-6 per cent each. Metal stocks lost sheen, with Tata Steel, Jindal Steel, Vedanta and JSW Steel losing 3-8 per cent each. Among the other index heavyweights, Tata Steel, Reliance Industries, Infosys and Hindustan Unilever shed between 3-6 per cent each.

The market breadth was abysmal. Out of 2,574 stocks traded on the BSE, there were 1,918 declining stocks as against 527 advances.