Weakness to continue as sentiments get hit by Coronavirus

Indian markets are likely to extend their losses as the global weakness is sure to spill on the Indian shores as well. SGX Nifty, which is currently trading almost 20 points below its yesterday’s close, is already reflecting it. Apart from the news flow of the spread of coronavirus, market participants will keep an eye on the corporate earnings as over 60 companies are likely to report their earnings which include key corporates such as Maruti Suzuki India, Mahindra and Mahindra Financial Services, JK Lakshmi Cement Cummins India and so on.  

Weaker western markets are having an impact on peers across the globe. The first sign is already visible in Asian markets. Japanese markets’ Nikkei 225 is sharply lower on Tuesday for a second straight day as concerns surrounding the deadly coronavirus weighed on sentiment.  

Back home, markets opened lower on Monday and it traded with capped losses in the first half of the session. However, the second half of the trading session, saw a fresh round of selling and ended the day near the low point of the day. BSE Sensex slipped 1.10 per cent and Nifty shed 1.06 per cent. Amongst the broader markets, Nifty mid-cap dropped 0.36 per cent, while Nifty small-cap ended up 0.03 per cent. On the sectoral front, barring Nifty Pharma, all other indices ended the day in red. Nifty Metal and Nifty PSU Bank were the top losers.

As for global happenings, a deep correction was witnessed in US markets on Monday. Market participants were rattled by reports that the Coronavirus in China has been spreading. Moreover, news that the virus has moved to other countries did not help the matter. In the economic news, new home sales unexpectedly fell. At the closing bell, Dow closed a good 1.6 per cent below its previous close yesterday, while S&P 500 was down by 1.5 per cent. The worst hit was the tech-heavy Nasdaq which plummeted a big 1.9 per cent. European benchmarks too followed their US counterparts and finished lower.