Sensex starts FY21 with 1,203-point plunge; banks, IT stocks hammered

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Published: April 2, 2020 8:02:15 AM

The daily turnover in the futures and options (F&O) segment for the Nifty was Rs 12.4 lakh crore.

Sensex, Indian equities, Nifty50, FPI, IT stocks, cash market, global equity marketsThe 30-share benchmark Sensex declined 1,203.18 points, or 4.08%, to close at 28,265.31.

Indian equities plunged on Wednesday, the first trading session of financial year 2020-21, erasing Tuesday’s gains as other global equity markets continued to see a sell-off. The 30-share benchmark Sensex declined 1,203.18 points, or 4.08%, to close at 28,265.31.

The broader Nifty50 declined 343.9 points or 4% to close at 8,253.8 points. The daily turnover in the futures and options (F&O) segment for the Nifty was Rs 12.4 lakh crore. For March, the average F&O turnover was Rs 11.8 lakh crore which is the lowest in ten months. According to market experts, this shows that the speculators in the markets have reduced.

The sell-off in Indian equities has come on the back of the relentless selling by foreign portfolio investors (FPIs) who in March pulled out $15 billion from the Indian equities and debt market, making it the highest ever outflow witnessed by the Indian  markets.

According to the provisional data on the exchanges, FPIs sold equities worth $146.17 million on Wednesday. Domestic institutional investors sold equities worth $58.9 million.

Ambareesh Baliga, an independent market expert, said. “ F&O trading is essentially a margin play as opposed to the cash market where one needs to pay 100%. Many of those trading in the F&O segment may not have moved to the cash market. The cash market usually has medium to long term investors.”

India started lower tracking its Asian peers who ended their day in the red. Bourses in Taiwan, Shanghai and Hong Kong were down between 0.4% to 2.1%. South Korea’s Kospi was down by 3.9%.

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