Virus Jitters Rock Indian Markets: Significant Dip in Equity Benchmarks

Indian equity markets faced a sharp decline on Monday, driven by global uncertainties, a weakening rupee, and the detection of Human Metapneumovirus cases. The Nifty 50 and BSE Sensex both plummeted, with PSU Banks trailing significantly. Investors remain cautious due to virus fears and looming economic concerns.

On Monday, India's equity markets experienced a significant downturn, with key indices falling over one and a half percent. This decline was influenced by global market unease, a depreciating Indian rupee, and reports of human metapneumovirus (HMPV) detection in the country.

The National Stock Exchange's Nifty 50 concluded the session at 23,616.05, a drop exceeding 388 points, while the BSE Sensex landed at 77,964.99, losing over 1,258 points. Across the board, NSE sector indices were entrenched in the red, with PSU Banks hit particularly hard, trailing nearly 4 percent. On the Bombay Stock Exchange, both midcap and smallcap indices saw declines of 2-3 percent.

Market analysts attribute the turmoil to rising fears regarding the HMPV outbreak in India, specifically following two reported instances in Karnataka. Ajay Bagga, a market and banking expert, commented on the challenging backdrop faced by investors, noting the slowing Indian economy and subdued corporate earnings growth. Additional pressures include foreign institutional investors offloading shares, exacerbated by a firmer US dollar and elevated US yields. The depreciation of the Indian rupee and uncertainty over US trade policies under the incoming administration have compounded concerns, creating a chilling effect on investor sentiment, particularly among retail participants.

(With inputs from agencies.)