Investor wealth on Monday tumbled over Rs 3.53 trillion, and the market capitalisation of all BSE-listed companies stood at Rs 201 trillion at the close of trade.
The latest sell-off came as the daily Covid-19 tally in the country crossed a record 273,810. The spike in new cases was accompanied by a severe shortage of medicines and other essentials, putting a spotlight on the country’s weak healthcare infrastructure. Health experts have raised concerns that a possible new variant could spread more rapidly.
The rise in Covid-19 cases has forced many states to impose lockdowns of varying intensity. Delhi
on Monday announced a week-long curfew.
Last week, Maharashtra, one of the biggest contributors to the country's gross domestic product (GDP), imposed strict curbs on movement.
“It remains to be seen if this second wave of Covid-19 cases subsides without a serious national-level lockdown.
A month of nationwide lockdown
costs 100-200 basis points of GDP.
Given the high economic cost, we expect the central and state governments to try to contain the spread with the tightening of Covid-19 regulations, night curfew, and localised lockdowns,” BofA Securities said in a note.
India's earnings and economic indicators showed signs of recovery in the last quarter amid a decline in the number of cases and easing restrictions. But the current wave has raised fears of possible recession and curbs in business activities. Analysts said the second wave could complicate corporate India's financial woes and hurt the economic recovery.
"We were expecting 20-25 per cent earnings growth this year, and those estimates will have to be trimmed. We have to see how long the lockdown
is. If it's over in another few weeks, the economic impact will be minimal,” said Andrew Holland, CEO, Avendus Capital Alternate Strategies.
All Sensex components, barring two, declined. Powergrid Corporation was the worst-performing Sensex stock and fell 4.1 per cent. ONGC and IndusInd Bank fell 3.9 per cent. More than a dozen stocks fell more than 3 per cent. All the sectoral indices on the BSE, barring one, ended the session with losses. Realty and capital goods stocks fell the most, and their sectoral indices fell 3.9 and 3.09 per cent, respectively. The market breadth was negative, with 2,199 stocks declining against 773 advancing stocks.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.