Indian markets ended higher on Tuesday amid reports that government will soon announce an economic package to help the coronavirus-hit sectors. Today, the start of session is likely to be negative as the government has announced a complete lockdown across the country for 21 days to contain the spread of fast-spreading novel coronavirus -- the COVID-19. The nationwide lockdown came into effect on March 24 midnight and will continue until April 14. Prime Minister Narendra Modi said the country will be set back by 21 years if we don't manage these 21 days. Meanwhile, the coronavirus death toll in India has gone up to 11 with the death of a man in Tamil Nadu. The total number of COVID-19 cases reported from the states so far is 562. However, some respite may come later in the day as Finance Minister Nirmala Sitharaman extended the deadline for filing tax returns by three months beyond March 31. She also announced a slew of regulatory and compliance measures across sectors to alleviate the hardships being faced by various businesses. Also, allaying fears that the economy may not be financially equipped to deal with the fallout of the global coronavirus pandemic, Sithraman said that there is no economic emergency in India. Some support may also come as investments through participatory notes (P-notes) in the domestic capital market rose to Rs 68,862 crore at the end of February, making it the second consecutive monthly increase. Meanwhile, stock brokers association Anmi has asked market regulator Sebi to close stock exchanges for at least two days, which will give brokerage firms time to close their entire outstanding positions, in case all states do not declare stock broking as an essential service, exempted from lockdown. Aviation stocks will be in focus as airlines have sought help from the government to help them pay employees’ salaries as the coronavirus disease (COVID-19) outbreak has forced the authorities to stop air transport till March 31. There will be some reaction in copper industry stocks with a private report that taking advantage of the lower international prices, India turned out to be a net importer of copper so far in this fiscal.
The US markets ended higher on Tuesday amid indications Democrats and Republicans are closing in on an agreement on a massive fiscal stimulus bill. Asian markets are trading mostly in green on Wednesday following overnight gains on Wall Street.
Back home, Indian equity markets staged a strong comeback after the biggest fall in history a day prior and ended Tuesday’s session with healthy gains of over two and half percent, on the back of sustained buying across sectors. The gains in the markets were in line with the gains seen in other Asian markets and European indices. Key indices made gap-up opening, as in a bid to provide additional liquidity to the system hit by the coronavirus outbreak, the Reserve Bank of India (RBI) decided to inject Rs 1 lakh crore and assured such move further also if required. The first tranche of term repo worth Rs 50,000 crore was conducted on March 23, while the second tranche of the same amount will be conducted on March 24. But, the markets wiped out all of their gains soon and traded marginally in red, as traders turned cautious with Prime Minister Narendra Modi expressing his concern on the impact of the coronavirus outbreak on Indian economy and said the informal sector will face the brunt and the impact on the overall economy will be felt gradually. However, selling proved short-lived as markets bounced back into the green in late morning deals, as the government raised the threshold that would trigger insolvency proceedings to Rs 1 crore from current Rs 1 lakh to help small companies facing the threat of defaults due to coronavirus-related lockdown. Buying further crept in after Finance Minister Nirmala Sitharaman stated that the government is preparing an economic package which will be announced soon in a bid to tackle the economic fallout affecting the Indian economy due to coronavirus pandemic. She also said the last date for filing Income Tax return for the year 2018-19 has been extended from March 31 to June 30, 2020. Though, markets erased most of gains in late trade but managed to garner gains of over two and half percent as the Finance Ministry declared the government expenditure system as an essential service, implying that all its payment functions will run normally to ensure that there are no delays in transfer of funds to meet any emergent needs amidst the coronavirus crisis. Finally, the BSE Sensex gained 692.79 points or 2.67% to 26,674.03, while the CNX Nifty was up by 190.80 points or 2.51% to 7,801.05.
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