After a fall, indices set to smile at start!
After a 'black Monday', the early cues from SGX Nifty indicate that the bulls would try to regroup and stage a comeback on D-Street as SGX Nifty is trading up by 30 points at 11,274 levels. However, the level of 11,340 is likely to act as a strong resistance level and the fragile global cues are not helping the cause. On the downside, the level of 11,185 levels is a crucial support.
Asian markets were trading lower on Tuesday, following a decline in the overnight trade on Wall Street. Hong Kong’s Hang Seng and China’s Shanghai Composite were down by 0.62 per cent and 0.45 per cent, respectively. Meanwhile, Japan’s Nikkei 225 was closed for a holiday.
After a lacklustre first half of the trading session, a sharp plunge was witnessed in the second of the trading session on Monday after news reports indicated that the UK may face a second Coronavirus lockdown after a resurgence in the cases and this spooked the market participants.
The European indices were also in a freefall, which further, exacerbated the situation. As a result, Monday turned out to be a ‘black Monday’ for the Indian markets where Nifty and Sensex plunged 2.21 per cent and 2.09 per cent, respectively.
The broader indices too followed suit with Nifty Mid-cap and Small-cap losing 4.06 per cent and 4.17 per cent, respectively. India VIX, the fear gauge for the Indian markets, jumped a whopping 13 per cent and settled above 22. It was broad-based selling so, all the sectors ended in the red.
The last hour rebound helped the US stocks to recover bulk losses but still, two out of the three major US stocks indices ended the first trading session of the week with substantial losses, while the tech-heavy Nasdaq ended just below the neutral line. The rising cases of Coronavirus in Europe and the news of another lockdown in the UK to break the spread of the virus send jitters down the spine of market participants. Meanwhile, the European stocks market went into freefall on Monday as a surge in the Coronavirus cases in the region left the market participants in a worrisome state regarding the economic impact of a potential second wave. In addition to this, financials too tumbled on the back of allegation of suspicious transactions.