Share trading on the stock exchanges in India will continue normally even after India enters a 21-day lockdown period, to curb the spread of Coronavirus.
Share trading on the stock exchanges will continue normally even after India enters a 21-day lockdown period, to curb the spread of Coronavirus. Ashishkumar Chauhan, CEO of the Bombay Stock Exchange took to Twitter to say, “BSE day to day operations will continue.” India will continue to be under a lockdown till April 14, as the number of Coronavirus cases in India continue to surge. Although India’s financial capital, Mumbai is already under a lockdown, stock exchanges have been operating normally.
Vishal Wagh, Research head, Bonanza Portfolio said, “Share markets in all countries that have been affected by the Coronavirus have been operating normally except one country where the trading was closed. There’s an intrinsic value for everything and the stocks are now at a discounted value because investors have factored in what was about to come.” Wagh says that Mumbai was already under a lockdown and the equity markets have still been operating normally so far and the same is expected to continue.
In his second televised announcement , Prime Minister Modi emphasised on the need of social distancing to control the spread of Coronavirus. So far India has over 500 cases of the virus with over 10 people having succumbed to their illness. “If we are not able to manage the upcoming 21 days of nationwide complete lockdown, we will be pushed back 21 years. You have to remember that a Coronavirus infected person initially appears to be normal and doesn’t show symptoms. So maintain precautions and stay at home,” Modi added.
Earlier in the week, Jimeet Modi, Founder & CEO, Samco Securities said that closing the bourses would result in the complete loss of reputation and confidence from a global standpoint. “ Most markets are trading online including India. Shutting down India’s markets when the rest of the world ( including Italy, Spain, etc) still operates online would mean and send a signal that we can’t have minimal BCP as compared to the rest of the world?” Jimeet Modi said. He had further stressed that closing the equity markets would be disastrous for those who would like to liquidate their positions to pay for hospital expenses. Modi suggested reducing trading hours if the need strikes.
Wagh further added that the lockdown is a positive for the economy and the share market in the long run. “Due to the lockdown, demand for everything that was diminishing will come back. The number of Coronavirus cases will drop under lockdown and we will see a reduction in the number of cases as India will enter the last week of the lockdown.” Although the lockdown will continue to be in place till April 14, along with the Bombay Stock Exchange essential services too will remain operational.