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Covid 2nd wave fears haunt stock markets

Sensex sinks 585 pts, Nifty slumps 163 pts; IT stocks bear the brunt

Focus on financials and metal stocks
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Focus on financials and metal stocks

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Mumbai: Equity benchmarks spiralled lower for the fifth consecutive session on Thursday as a resurgence in Covid-19 cases in multiple states fanned fears of a second wave of the pandemic, even as global markets darted up after the US Fed reiterated its dovish stance.

After rallying nearly 500 points earlier in the day, the 30-share BSE Sensex succumbed to selling pressure in afternoon trade to close at 49,216.52, down 585.10 points or 1.17 per cent. Similarly, the broader NSE Nifty slumped 163.45 points or 1.11 per cent to finish at 14,557.85. The Sensex has now lost 2,062.99 points in five sessions, while the Nifty has shed 616.95 points. After rising for the past few days, IT stocks bore the brunt of profit-booking in Thursday's session. HCL Tech was the top loser in the Sensex pack, shedding 3.97 per cent, followed by Infosys, Dr Reddy's, TCS, Tech Mahindra, Reliance Industries and NTPC. On the other hand, ITC, Bajaj Auto, M&M, Maruti and Bharti Airtel were among the gainers, rising up to 3.25 per cent. Traders said rising Covid-19 cases in various parts of the country and reimposition of localised restrictions have unnerved investors.

"Having seen a brisk gap-up opening on positive global cues, domestic equities fell sharply for the fifth consecutive day as sharp rise in coronavirus cases in the country made investors jittery. The mounting concerns of possible fresh economic restrictions made enthusiasm of dovish commentary from Federal Reserve short lived for domestic markets. "Additionally, a fresh spike in 10-year US Treasury yield to 1.72 per cent also weighed on investors' sentiments. Notably, investors' wealth got eroded by over Rs 3 lakh crore today and around Rs9 lakh crore in last five trading days," said Binod Modi, Head Strategy at Reliance Securities.

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