market crash

The Indian stock market crashed Feb. 28, amid fears of the coronavirus. (IANS Infographics)

MUMBAI — Fears of larger than anticipated disruption due to an imminent pandemic caused the stock market to crash Feb. 28. Dalal Street mirrored global stocks headed for their worst week since the 2008 financial crisis.

The benchmark Sensex lost 1,448 points in a broad based sell-off which saw none of its 30 constituent stocks withstanding the carnage.

The 'Fear Index' or India 'VIX' logged one of the steepest single day jump in recent past closing at a record high of 22.87 as fresh cases of coronavirus infection surged outside China.

This added to the caution among investors ahead of the 3QFY2019-20 GDP data release due later in the day, that was also expected to remain subdued.

Nifty Metal index plummeted 7 percent, the most among the 11 Nifty sectoral indices. It was followed by IT, media and PSU Bank index. The pivotal — banking and financial service sectors index — closed over 3 percent lower.

"Increase in new virus cases is diluting investor wealth across the globe. On the domestic front, broad-based selling was witnessed with sectors having global exposure like Metals & IT being impacted the most," said Vinod Nair, Head of Research at Geojit Financial Services

The top laggards on the Sensex were: Tech Mahindra, down 8.14 percent; followed by Tata Steel, Mahindra and Mahindra, HCL Tech, Bajaj Finance and Infosys.

Wall Street's benchmark index, Dow Jones Industrial Average closed (down 4 percent) with record losses on Thursday. China's Shanghai SE Composite Index was trading 3.71 per cent lower while Japan's Topix tumbled 3.6 percent. Hong Kong's Hang Seng plummeted over 3 percent.

Besides, the futures markets pointed at no near-term relief for investors. FTSE 100 Index Futures pointed at a rough start. The index was down 3.44 percent, NASDAQ 100 Future also traded lower by 1.29 percent.

The coronavirus (COVID-19) outbreak is likely to be declared a pandemic and focus is now shifting from China to South Korea, Iran, Italy and Japan — where cases are escalating fast, even Germany, Brazil and several others have joined the list, Moody's said Feb. 28.

The World Health Organization has said that the coronavirus outbreak has reached a "decisive point" and has "pandemic potential" as the toll in China, the deadly disease's country of origin, increased to 2,788 Feb. 28.

 The number of coronavirus cases in South Korea increased to 2,022 Feb. 28. Italy has confirmed 122 more coronavirus cases, bringing the total number of confirmed cases to 650.

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