Indian bourses dip 1% on rising COVID cases in South Asian countries

India’s benchmark indices fell more than 1% responding to signs of COVID-19 re-emerging in South East Asian countries.

The benchmark Nifty and Sensex declined to 24,684 points and 81,186 points respectively on Monday. All sectoral indices with Auto Index slipped over 2% in both Sensex and Nifty. 

“Market sentiment remained negative, with 42 of 50 Nifty constituents ending in the red. The NSE advance-decline ratio stood at 1:2, reflecting widespread investor caution across sectors, particularly in auto, defence, and financial stocks,” said Devarsh Vakil, Head of Prime Research at HDFC Securities.

COVID-19 fears also led to the rupee depreciating 16 paise to ₹85.58 against the dollar. “The Indian Rupee has faced headwinds recently, becoming one of the worst performers among Asian currencies. This depreciation is attributed to foreign fund outflows from domestic equities, higher global bond yields, a general downturn in market sentiment, and concerns over rising COVID-19 cases in some Asian regions now,” said Dilip Parmar, Senior Research Analyst at HDFC Securities.

For the market to turn positive in the short run, it has to trade above 24,850 points and should not go below 24,550 to 24,500 on Nifty, said Shrikant Chouhan, Head of Research at Kotal Securities. On the Sensex, this threshold is 80,800 to 81,700.