PM Modi's address fails to offer markets relief ahead of long weekend

Amid the 21-day countrywide lockdown, traders in India have another challenge to face in the form of a long weekend as Prime Minister Narendra Modi’s address to the nation on Friday (April 3) morning could not offer specific measures being taken to curb the spread of the coronavirus.

Following a day’s holiday, stocks in India declined on Friday after one of the worst starts to a new fiscal year since 2007. The markets in India will remain closed again on Monday (April 5) for another holiday.

On Friday morning, the S&P BSE Sensex Index fell 1.2 per cent to 27,913.75 in Mumbai and the NSE Nifty 50 Index declined at a similar rate after the prime minister used a video to address the nation and urged the citizens to light candles and lamps at 9 PM on Monday to “move towards the light and challenge the darkness of the pandemic” and maintain social distancing.

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“It’s too dynamic right now for traders ahead of the long weekend. There is a constant push and pull between signs of containment of the virus and discounting its impact on the economy,” Dharmesh Kant, head of retail research at Indianivesh Securities Ltd told NDTV.

Adding to the country’s troubles in war against the increase in number of confirmed coronavirus cases and abiding by the three-week nationwide lockdown, there lies a fight to save the economy as well.

After the Sensex recorded its worst quarter ever, data curated by Bloomberg revealed that foreigners withdrew a whopping $15 billion from India’s stock market last month.

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Kant told NDTV that till the time foreigners keep pulling out their funds, the market will sell on up ticks.

With several traders opting for work from home and banks operating with only 50 per cent of the staff, trading volume in the country’s financial markets has plunged to an extent where the sovereign bonds dropped, with returns on benchmark 10-year debt rising 14 basis points to 6.28 per cent.

On the same note, the rupee fell by 0.8 per cent to 76.1362, nearing its record low of 76.2750 on March 23 when both the markets opened after a two-day holiday.