Indian Market Dwindles With New Of Fresh Lockdown
As news travels like wild fire over a possible second lockdown in India, the stock market has miserably crashed this morning. The loss, as recorded has been Rs. 4.54 lakh crore to investors in the morning trade itself.
The market opened pretty flat. But it went into severe depression thereafter as the news went around about possible Covid-19 led lockdown again. Economic analysts feel that this might bring another setback into the recovering economy.
The daily toll today has been the highest brining the count to over 12.5 million. The worst hit is the Maharashtra state where lockdown has been put into place, owing to massive contracting numbers.
Financials and rate-sensitive stocks fell nearly 2.5 percent. According to Binod Modi, head, strategy at Reliance Securities, “Banks, which started seeing steady improvement in asset quality and improvement in credit costs, may see further delay in credit cycle recovery and pressure in asset quality if business restrictions are imposed by more number of states due to steep rise in Covid-19.”
But economists suggest that the market should refrain from panic selling. Holding on to portfolios and waiting for the market to correct itself would be a wiser option. The market situation should be looked as an ideal buying opportunity for the next 6-8months as India’s long-term growth story remains intact and such dips can be used to get into quality portfolios.
Treasury bonds are being said to be the safest investment option right now, especially in times of economic slowdown.