Sensex drops 6% on economic fears

Selling in the global markets and extremely weak domestic economic data triggered over 2,000 points fall in the Sensex, and the

Nifty-50 slumped 566 points. Both the market indices fell close to 6 per cent, wiping out 80 per cent of last week’s gains.

The Sensex closed at 31,

715.35, down by 2002.27 points or 5.94 per cent, while the Nifty-50 closed at 9,293.50, down by 566.40 points or 5.74 per cent.

The market opened lower after extended weekend as the US president Donald Trump threatened new tariff on China blaming it for Covid-19, which spooked market participants across the globe, and the selling got accelerated after data showed India's manufacturing activity for April and GST collections for March had dipped sharply.

Manufacturing data indicated by the Purchasing Managers Index, or PMI, dropped to 27.4 for April due to the lockdown impact as against an average of 50 and GST collection for March so far were just around `30,000 crore, indicating that economic activity got severely affected, reports said.

Shrikant Chouhan, executive vice president, equity technical research at Kotak Securities, said, “Indian market collapsed in sync with the weakness in global markets and the continuing delay in fiscal stimulus package announcement by the government and there is no doubt that the weakness would increase in the coming days.”

The fall in the market was quite widespread. Bank and financials were hit the hardest. Nifty Bank Index and Auto Index fell 8.32 per cent and 7.21 per cent respectively.

THE MARKET opened lower after extended weekend as the US president Donald Trump threatened new tariff on China blaming it for Covid-19, which spooked global markets