Markets skid 1.5% due to virus fears, profit-taking

The BSE Sensex, a day after scaling the mark of 50,000, plunged around 746 points, which is 1.5 percent, on Friday to close at 48,878.54, as investors tried to book profits at higher levels. The broader Nifty index was also seen to drop 218.45 points or 1.5% which is close to 14,371.90.

The stocks in the Asia-Pacific have also been reported to have been traded lower. Hong Kong’s Hang Seng fell by 1.6%, China’s Shanghai Composite by 0.4%, Japan’s Nikkei by 0.44%, and South Korea’s Kospi by 0.64%. The investors’ sentiments were also hurt by worries of the new covid restrictions in China since undetected virus infections started spreading quickly during the very celebrated Lunar New Year holiday.

Rusmik Oza, who is the head of fundamental research of Kotak Securities, said that they are looking for some kind of profit-booking at the higher levels since the Sensex touched the psychological mark of 50,000 this week. The disturbing rise in the Covid cases has forced the authorities to intensify the restrictions in certain parts of Europe, the UK, and Hong Kong. This, in turn, has been affecting the global market. Rusmik Oza also added that they are expecting the volatility to remain high next week also due to the monthly expiry and it is going to be the last week before the Union budget.

Sampath Reddy who happens to be the Chief Investment Officer of Bajaj Allianz Life Insurance expects Nifty earnings growth per share to be in the higher single digits in the financial year of 2021. He also believes that the growth will be followed by a strong recovery of at least 30% in the financial year of 2022.

He ended by saying that 2021 is expected to be the year that ends the pandemic and its grievances. He seemed confident of it and said that following this, they will finally begin the process of future growth. 

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