Rising Covid Cases Trigger Market Meltdown, Sensex Crashes 900 Points Amid Fresh Virus Fears
This comes after a period of sustained gains in the market, prompting speculation about the causes behind the sudden dip.
The Indian stock market witnessed a significant correction on Thursday, halting its recent rally. The S&P BSE Sensex plunged over 900 points to 80,681.76, while the NSE Nifty50 dropped by 266 points to 24,547.45 as of 12:45 pm. This comes after a period of sustained gains in the market, prompting speculation about the causes behind the sudden dip.
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Rising Covid Cases Spark Investor Caution
The decline coincides with a noticeable rise in Covid-19 cases across parts of India and Asia. In India, Kerala alone reported 182 cases in May, while cities like Mumbai, Chennai, and Ahmedabad are seeing a small but steady uptick. Globally, countries such as Hong Kong, Singapore, and Thailand are also experiencing a surge in infections, raising fears of a potential resurgence of the virus.
Also Read: Experts Warn of Fresh Covid-19 Wave, Urge Public to Follow Precautions
Healthcare, Pharma Stocks Gain Defensive Momentum
Kranthi Bathini, Equity Strategist at WealthMills Securities, said the rise in Covid cases could be contributing to a sectoral shift in investor focus.
“There is a worrying factor, which is why we’re seeing gains in healthcare, diagnostic, and pharma stocks,” he noted. However, he cautioned that it is too early to draw firm conclusions as most states are still reporting low case numbers.
Market Correction Driven by Multiple Global Factors
Bathini explained that the broader market remains fundamentally sound.
“We’re seeing profit booking influenced by global cues—such as US debt concerns and credit rating downgrades—that are applying short-term pressure,” he said.
Nifty, he added, seems to be forming a base between 24,500 and 25,000, and stock-specific action is continuing as the earnings season winds down.
No Need to Panic Yet, Say Experts
Despite the dip, market analysts advise investors to stay calm.
Trivesh, COO of Tradejini, stated, “Investors are more seasoned now when it comes to Covid-related news. Pharma stocks may attract defensive interest, but overall, market fundamentals remain intact. We may see some volatility, but panic is unlikely.”
Looking Ahead: Watchful Weeks Ahead for Investors
With Covid cases on the rise and global uncertainties still looming, experts believe the next few weeks will be crucial in determining the market’s direction.
While some short-term fluctuations are expected, long-term investors are being urged to remain focused and avoid hasty decisions.
