Freaky Friday! We have seen worse than this in Sensex history







Autoplay Autoplay 1 of 6 Carnage on D-Street Domestic equity indices witnessed one of the worst crashes in a single day on Friday as coronavirus scare sent equity investors scurrying for cover amid a global risk aversion and equity meltdown. The virus has now invaded all six habitable continents. US markets saw their worst fall in overnight trade as local governments started preparing to contain the spread of the virus in the country. Indian indices followed suit, with Sensex tumbling over 1,100 points. If the market sustains at this level till close of trade, it will be its third largest pointwise fall ever.



Here we revisit some of the worst crashes in Sensex's history: ​August 24, 2015: 1,624 points Sensex recorded its worst fall in history on a closing basis riding on a slump in Chinese markets and spooked by rising crude oil prices. Shanghai shares slumped more than 8 per cent, leading to a worldwide rout on the ominous day. BSE's market-cap fell by about Rs 7 lakh crore in a single day. January 21, 2008: 1,408 points The BSE flagship saw a 1,408-point plunge amid high volatility as investors panicked following weak global cues amid fears of a US recession. During the session, it crashed to the day's low of 16,963, but later recovered to close at 17,605. ​October 24, 2008: 1,070 points The recession triggered by the 2008 global financial crisis which brought down Sensex from a high of 21,000 to 8,000 level in a span of 10 months was the reason behind its third biggest fall ever. The 30-share pack fell nearly 11 per cent to close at 8,701. NSE barometer Nifty had crashed 13 per cent on that day. February 1, 2020: 988 points The fourth biggest crash for the index came in this day. Some of the announcements made in the Union Budget by Finance Minister Nirmala Sitharaman did not go down well with investors and they rushed to withdraw money.

What virus? Asian investors still think markets will end higher in 2020







Autoplay Autoplay 1 of 8 Analysts remain calm Keep calm and carry on is the message from Asian financial experts even as the region’s emerging markets take a battering from the spread of the deadly coronavirus.

Note: Inputs from Bloomberg survey was conducted from Feb. 14 to Feb. 21.

The survey participants were: Asset Management One Co.

AxiCorp

Bank of Singapore Ltd.

BNP Paribas Asset Management

Citi Private Bank

Deutsche Bank Wealth Management

Fujitomi Co.

Kasikornbank Pcl

Loomis, Sayles & Co.

Malayan Banking Bhd.

Mitsubishi UFJ Kokusai Asset Management Co.

Mizuho Research Institute Ltd.

Monex Inc.

Office Fukaya, Research & Consulting

Siam Commercial Bank Pcl

Scandinavian Enskilda Banken AB

UBS Asset Management

UOB Private Bank Emerging-Asia 2020 performance outlook: Stocks, bonds and currencies in the region are all tipped to rise this year as central bank easing and government stimulus measures outweigh the impact of the epidemic on Asian economies, according to a survey of 18 traders, strategists and fund managers undertaken this month. The favorite asset to buy among currencies is the Indonesian rupiah, while investors looking to purchase bonds or stocks should both choose China, the survey found. Rankings by country The rupiah was the most-favoured currency amid speculation investors will search for higher yields as global central banks ease policy to counter the impact of the virus. Chinese bonds and stocks were both ranked first in their categories after Beijing announced monetary easing and fiscal support measures.

Market drivers “The current coronavirus scare will probably stabilize around the second quarter, and that will lead to a recovery in economic activity,” said Tetsuya Yamaguchi, chief technical analyst at Fujitomi Co. in Tokyo. “As emerging-market central banks could either cut or stay on hold, interest rates will probably remain low globally. That makes a good case for a rebound if you look ahead for the year, especially after the kind of sell-offs we’ve seen that made assets quite cheap.”

Virus impact expected to fade “The current coronavirus scare will probably stabilize around the second quarter, and that will lead to a recovery in economic activity,” said Tetsuya Yamaguchi, chief technical analyst at Fujitomi Co. in Tokyo. “As emerging-market central banks could either cut or stay on hold, interest rates will probably remain low globally. That makes a good case for a rebound if you look ahead for the year, especially after the kind of sell-offs we’ve seen that made assets quite cheap.”

Global risk aversion sparked off by coronavirus has wiped out major wealth for top Indian billionaires.Reliance Industries’ Chairman Mukesh Ambani , the richest man in India and whole of Asia, has lost some $5 billion of his wealth year to date in notional terms. Aditya Birla Group Chairman Kumar Mangalam Birla is poorer by $884 million, as per Bloomberg Billionaire Index . IT tycoon Ajim Premji’s wealth is down by $869 million and industrialist Gautam Adani’s by $496 million in just two months. Uday Kotak and Sun Pharma’s Dilip Sanghvi also are among the biggest losers, as stocks of their companies have received a huge battering, destroying major wealth.Most of this wealth erosion happened over the last 15 days, when domestic equity indices have come tumbling down. BSE Sensex has crashed nearly 3,000 points in 11 sessions since February 12, when Dalal Street first caught the chill from the virus. This stock rout has wiped off Rs 11.52 lakh crore of equity investors’ wealth on Dalal Street.In tandem, broader market indices have also seen severe correction during this period, wiping most of their gains logged so far in 2020.Among the large Indian business conglomerates, Reliance Group has been the most affected in terms of loss of market capitalisation of their listed stocks. The market-cap of all RIL firms have come down by Rs 53,706.40 crore between February 13 and February 27. In Friday's market crash, as Sensex plunged 1,100 points, RIL shares fell 2.8 per cent.RIL group firm Reliance Industrial Infrastructure has taken the biggest hit, down over 13 per cent since February 12. Reliance Industries and Network18 have slumped 6 per cent, TV18 Broadcast 7 per cent and Den Networks 2 per cent. However, shares of Hathway Bhawani Cabletel & Datacom, which RIL acquired recently, has soared over 16 per cent.Despite this about turn in Reliance Industries’ fortunes, analysts remained positive on the stock. As many as 26 analysts had either a ‘buy’ or ‘outperform’ rating on the stock. Only one analyst had a ‘sell’ call, as per Reuters data.Tata Group companies have lost Rs 41,930 crore. Shares of as many as 21 of group firms have slipped into the red during this period. Automotive Stampings & Assemblies and Tata Teleservices have fallen 25 per cent each. Tata Motors and Tata Elxsi dropped 15 and 12 per cent, respectively.Tata Motors-owned Jaguar Land Rover warned that its production schedules in the UK as well as India are under strain due to its supply chains in coronavirus-hit China. In fact, last week the company flew Chinese parts in suitcases to Britain to maintain production.On Friday, Tata Motors fell 9 per cent and Tata Steel 6.7 per cent.Emkay Research has ‘buy’ rating on Tata Motors with a price target of Rs 238, which means a 64 per cent potential upside from last close. Prabhudas Lilladher has a ‘hold’ recommendation with a price target of Rs 185.Among other major business houses, Adani group has lost over Rs 27,100 crore in market capitalisation of its stocks, Aditya Birla Rs 17,500 crore and Wadia Group which controls firms like Britannia has lost Rs 3,300 crore.Analysts have mixed outlook for the market as they fear the risk of coronavirus outbreak becoming pandemic.Marc Faber, author of the Gloom, Boom & Doom Report, on Friday said markets have significant downside risks, given that the coronavirus is destroying several industries, and also because bluechips are trading at rich valuations.However, seasoned Dalal Street investors like Hiren Ved of Alchemy Capital Management, feels this meltdown could be a good time to accumulate good stocks.