Last Updated: March 20, 2023, 09:27 AM IST
Market Opens: Indian indices opened on negative note on March 20 with Nifty below 17,100. Key indices Nifty50 declined over 100 points to trade below 17,000 levels, whereas the S&P BSE Sensex lowered over 200 points to trade around 57,776 levels.
Broader markets, too, edged lower in trade as Nifty Midcap 100 and Nifty Smallcap 100 indices dropped up to 0.3 per cent. Volatility index, India VIX, meanwhile, jumped over 5 per cent.
All sectors drowned in the sea of red, with Nifty IT, Nifty Metal, Nifty PSU Bank, and Nifty Media indices declining over 1 per cent each.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “The fears of financial contagion rising from the banking crisis in US and Europe appear to be largely contained by the quick response of the governments and central banks. The big learning from the global financial crisis of 2008 is that failure of large financial institutions will lead to systemic issues leading to financial contagion and ultimately to recession. Learning from this crisis, this time there has been a concerted global action – the latest being the buyout of Credit Suisse by UBS – to contain the crisis. The volatility index in the US at around 25 doesn’t indicate any panic like in 2008. However, investors may remain cautious and wait for stability. The boost to India’s macros arising from reduction in trade deficit and big decline in Brent crude to $73 are positives from the market perspective.”
Global Cues
Asian stocks steadied and US futures rose on Monday in relief at a weekend rescue deal for Credit Suisse and a concerted effort from central banks to shore up the mood, though trade was tense and volatile as contagion fears stalked financial shares.
Wall Street closed lower on Friday, marking the end of a tumultuous week dominated by an unfolding crisis in the banking sector and the gathering storm clouds of possible recession. All three indexes ended the session deep in negative territory, with financial stocks down the most among the major sectors of the S&P 500.
Oil prices rose on Monday after suffering their biggest weekly loss in months as UBS struck a deal to buy Credit Suisse and some of the world’s largest central banks sought to reassure and stabilise global financial markets.
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