Indian equity market continued to be in the bear phase with the BSE Sensex ending 2,919 points lower during the closing session after the World Health Organization (WHO) declared coronavirus as a global pandemic. Broader Nifty ended 868.25 points lower during the closing trade on Thursday.
Sensex ended at 32,778.14 down by 2919.26 -8.18% while Nifty ended at 9,590.15 points down by 868.25 -8.30% during the closing session on Thursday.
India's stock market was down by 8.1%, indicating that Indian markets were the most affected.
Moreover, Rs 11 crore wealth was erased on Thursday.
"Today Indian Markets witnessed one of the worst single day fall in recent times, with Nifty falling over 900 points and Sensex crashing by over 3,000 points. The major reasons for this crash is the coronavirus scare, with no confirmed news on how many could get affected due to the virus and no cure or vaccine available as yet. In the short run, margin calls and stop losses are triggering panic selling in the market which is creating a cyclical effect as this is further pushing the stock prices downwards," said Amit Gupta, Co-Founder and CEO, TradingBells.
Similar bear run was witnessed in the global markets. All Asian indices also were trading in the red. WHO declared the disease a pandemic on Wednesday following which the Dow Jones Industrial Average also slumped significantly.
"At the same time, escalating tensions between the US and Russia over oil prices are pushing crude oil prices further down, and the same is escalated further due to travel bans across the globe. With fewer people travelling, airlines and tourism industry along with all ancillary sectors will take a hit and this will in turn not help oil prices gain any momentum in the near-term," Gupta added.
Experts say that it is best for investors to stay away from the market for a while till the volatility settles and there are notable reversals.
"It is natural to be induced towards averaging your portfolios or buying fresh stocks, however we are advising our clients against this and wait for the tide to settle before re-entering the markets, which will be a really good time to start investing for the long term," he added.
"At the moment, investors must look at stocks which have not fallen as much from their highs, as these are the ones which could withstand the wind better than the others due to their strong fundamentals. We will be releasing a list of such stocks shortly to our investors based on their low-to-high ratios," Gupta said.
Earlier, during the day Sensex plunged over 3,200 and the broader Nifty was down by 883.35 -8.45% at 9,575.05 points on Thursday.
At 11.16 a.m., the Sensex was trading at 33,188.01, lower by 2,509.39 or 7.03 per cent from its previous close of 35,697.40.
It had opened at the day's high of 34,472.50 and has touched a low of 32,990.01 so far.
The bear run in both the global and domestic markets has continued off late on concerns of the coronavirus outbreak severely impacting the global economy. It has also raised calls for government intervention and support.