INSUBCONTINENT EXCLUSIVE:
Mumbai: Indian stocks swung from extreme fear to guarded optimism on Friday as the firefighting efforts of governments and central banks
introduced a semblance of stability after markets were ravaged by worries about the effect of coronavirus on economic growth
Benchmark indices closed over 4 per cent higher on Friday, rallying strongly from the unusual 10 per cent plunge in early trade, which
activated the lower circuit breaker that resulted in a mandatory trading halt
breached the 9,000-mark early on Friday, resulting in the market sinking deeper into the bear territory
Brokers said aggressive purchases from LIC and other public-sector insurers along with treasuries of some state-owned firms paved the way
for the market recovery after the trading resumed, forcing traders to square off some of their bearish bets that helped the Sensex and Nifty
Nifty rose 433.50 points, or 4.52 per cent, to close at 10,023.65 after falling to 8,555.15
This is the first time since January 21, 2008 and the fifth instance in the past two decades that trading in India has been frozen because
of indices hitting the lower circuit
Trading was halted for 45 minutes to ease the panic after the Sensex and Nifty plunged 10 per cent.
Soon after the indices hit circuit
breakers, the Securities and Exchange Board of India (Sebi) rushed to reassure the markets, saying it was monitoring the positions of margin
payments, margin utilisation and adequacy of collaterals.
Investors, however, remained on tenterhooks that was reflected in the elevated
levels of the Volatility Index
institutional investors, including insurers and mutual funds, net bought shares worth Rs 5,867.90 crore helping offset the impact of selling
by foreign portfolio investors worth Rs 6,027.58 crore.
Analysts said the rebound prompted foreign trading desks to cut some of their
from its record low levels after the Reserve Bank of India intervened to stem the slide, making it the second best-performing currency for
the day in the Asian region.
European stocks rebound sharply
The rupee hit record low at 74.50 Friday, surpassing its erstwhile record level
at 74.48 in October, 2018
The local unit recouped its early losses after the RBI intervened, selling dollars
It gained 0.42 per cent to close at 73.91 per dollar
Chinese yuan was the best performing Asian currency Friday
The RBI was said to have intervened in the spot market as some state-owned banks were seen selling dollars on behalf of the central
Italian and Spanish securities regulators temporarily banned short selling in a number of stocks following record losses on
Thursday.
Central banks around the world also announced measures to calm the markets
for banks in a move to ease liquidity conditions
The moves helped Asian markets recover early losses though most of them ended weak.
Financial markets are reflecting the anxieties that has
erupted due to the disruptions triggered by the spreading coronavirus
Several countries in Europe have closed schools and restricted travel
In Italy, people have been living under a lockdown
The count of those affected by the pandemic is surging with at least 138,170 cases across the world
Investors have been worried that slowing economic activity would result in a global recession.
Till Thursday, the Sensex and Nifty had
fallen more than 20 per cent since February 19, officially entering the bear market, driven by foreign portfolio selling worth Rs 40,600
The rebound on Friday helped erase a portion of the losses
Indian markets are down 17.5 per cent since February 19.
