Posted on: July 21, 2021 Posted by: Administrator_India Comments: 0
Markets fall for third day on the trot amid delta variant worries

By Administrator_India

Capital Sands

The benchmark indices fell for the third day in a row, as rising coronavirus infections created fresh worries about business disruption and derailing economic recovery. Inflation concerns also kept investors on tenterhooks. Many countries, especially in Asia, have been forced to impose stricter lockdown measures as they are grappling with curbing the Delta variant of Covid-19.

The benchmark Sensex shed 355 points to end the session at 52,198, a fall of 0.7 per cent. The Nifty, on the other hand, fell 120 points to end at 15,632, or 0.7 per cent.

Analysts said after a stellar up move so far this year, in the coming months there could be periodic bouts of volatility. Further analysts said that fears of further lockdowns and other restrictions could upend the worldwide economic recovery, and risky assets across the globe have come under pressure.

“Markets drifted further lower in continuation to yesterday’s fall. On the global front, the concerns over the economic recovery due to the rise in covid cases due to new virus variants impacted sentiment. We believe concerns over global economic recovery are worrying participants as the third wave of Covid is fast spreading. Besides, domestic cues are also not very encouraging so far. In short, we may see further slide ahead,” said Ajit Mishra, VP – Research, Religare Broking.
The dollar strengthened, and US bond yields closed at 1.18 per cent, the lowest since the second week of February this year. Falling bond yields is a sign that investors’ faith in economic revival is diminishing, said experts. Oil prices fell amid worries about demand and an OPEC agreement to increase supply.

“The sharp fall in crude price and US bond yields reflected the rising concern over fall in future growth,” said Vinod Nair, head of research Geojit Financial Services.

Analysts said that investors are sitting on high valuations, and slight fear could trigger profit booking. Some analysts said the correction in the last three days was a healthy sign and said that the excessive valuations will render the inevitable crash very severe and painful in the absence of corrections.

“Patchy monsoon rain in India and subdued Q1FY22 corporate results raised fresh concerns on the economic growth and market valuation,” said Deepak Jasani, head-retail research, HDFC Securities.

The market breadth was negative, with 2,098 stocks declining and 1,137 advancing. As many as 434 stocks touched their 52-week highs, and 449 were locked in the upper circuit.

Two-thirds of the Sensex stocks ended the session with losses. IndusInd Bank was the worst-performing stock and ended the session with a loss of 3.32 per cent. All the sectoral indices ended the session with losses. Realty and Metal stocks fell the most, and their gauges fell 2.4 per cent each.

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