Sensex tanks 2,702 points, ends at six-month low - Times of India

Sensex tanks 2,702 points, ends at six-month low – Times of India

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Dalal Street investors pressed the panic button on Thursday morning as Russian forces invaded its neighbour Ukraine, the first such attack on an independent nation in Europe since the end of World War II.
After starting the day with aloss of about 1,800 points, the sensex recovered some ground in mid-session but fresh selloff in late trades pulled it down to below the 55K mark and it closed at 54,530 points, down 2,702 points, its fourth biggest single-session loss ever.
The impact of the day’s crash in the market could be gauged from a few more data points: All the 30 sensex stocks closed in the red, while in the broader market, for every one stock that closed higher, nearly 15 stocks ended with losses. The day’s selloff also left investors poorer by Rs 13. 5 lakh crore, its second-biggest one-day loss, behind Rs 14. 2 lakh crore recorded on March 23, 2020, with BSE’s market capitalisation now at Rs 245. 6 lakh crore.

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Around the world, other markets as well as most other assets witnessed high volatility as the Russian attacks on Ukraine started. Around Asia, the Hang Seng in Hong Kong closed 3. 2%, while Nikkei in Japan ended 1. 8% down and Shanghai Composite in China lost 1. 7%. In late trades around Europe, the DAX in Germany was down 4. 5%, while the FTSE in the UK was down 2. 8%. In Russia, as war-related uncertainties gripped the economically-struggling country, the Moscow stock index tanked nearly 50% intraday and trading was suspended. And in the US, the Dow Jones and S&P 500 indices both opened about 2% lower.
Outside of stocks, the rupee had deprecated by 108 paise against the US dollar, Bitcoin was down more than 8% at around $35,500 level, while gold was up more than 2. 5% to $1,959-per-ounce and Brent crude was up 8. 2% to near the $105-per-barrel mark. While the yellow metal is at more than a year high level, crude is at near its eight-year high mark.
The war-related uncertainties also prompted investors to look for safe haven assets which include gold, US dollar and US government bonds. As a result, the dollar rallied against most currencies while yields on 10-year US government bonds softened to 1. 87% level. Just a week ago, this yield was at about 2. 07% level, a multi-year high.
Fund managers said it’s a tough task to forecast how long the volatility will persist. According to Nilesh Shah, group president & MD, Kotak Mahindra Mutual Fund, it’s difficult to predict the bottom of the market in a scenario like war. “Events will shape the movement,” Shah said. “The best thing for an investor is to follow asset allocation principles. This is likely to be a buy-on-dip market albeit with a lot of volatility in the near term. ”



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