Sensex records biggest single day fall; investors lose 10 lakh crore

March 23, 2020

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The impact of the spread of coronavirus was clearly visible on the stock market today. With the sharp decline, lower circuits had to be activated within the first half-hour in the open market. However, when the market resumed trading 45 minutes later, the decline further increased. At the end of trading, the Sensex fell 3934.72 points to 25,981.24 and the Nifty closed 1,135.20 points down at 7,610.25. This is the biggest drop in Sensex history. Today, the Sensex had lost 4035 points during intra-day. Earlier on March 13, the market had lost 3389 points. On March 12, the market had dropped by 3204 points. In March, the Sensex has fallen 12,316 points so far. The market has fallen nearly 33.2% per cent during the month so far. At the same time, the market has fallen 15325 points this year.

3 reasons for market decline

1. Due to the spread of coronavirus infection, many states of the country have been locked down till 31 March.
2. Foreign investors are continuously withdrawing money from the Indian market. In about two weeks, they have sold shares worth Rs 50,000 crore.
3. Markets worldwide are declining due to fear of spreading coronavirus infection. The Hong Kong market saw a 5% decline.

Top 5 biggest market fall recorded in March 2020

Date	Points Dropped
23 March 2020	3934
13 March 2020	3389
12 March 2020	3204
16 March 2020	2919
9 March 2020	267
22 January 2008	2273
21 January 2008	2062
24 August 2015	1741
28 February 2020	1526
06 March 2020	1460

Shares of about 85% companies on BSE declined

BSE’s market cap stood at Rs 101 lakh crore
Shares of 2,401 companies were traded. In this, shares of 233 companies rose and 2,036 companies declined.
Shares of 14 companies remained at 1-year highs and shares of 1180 companies were at one-year lows
57 companies hold upper circuit and 671 companies have lower circuit

Lower circuit means, very bad market time

The circuit system was implemented in July 2001 SEBI guidelines. The circuit is put in place to stop the sudden ups and downs in the Indian stock market. There are two types of these. Upper Circuit and Lower Circuit. The upper circuit is placed when the market exceeds a set limit. And when the decrease exceeds the same limit, a lower circuit is used. SEBI has fixed three trigger limits for the circuit at 10%, 15% and 20%. That is, 10%, 15% and 20% of the market that is on the market at the time – the circuit starts. On Friday, after the sharp fall in the market, the lower circuit was put in the Sensex.

Market cap reduced by Rs 10 lakh crore

Due to the sharp decline in the Sensex, the market cap of companies listed on BSE has decreased by Rs 10 lakh crore. After the market closed on Friday, the market cap was Rs 116.09 lakh crore, which has now come down to Rs 105.91 lakh crore.

2.3% drop in crude oil

Crude oil remains volatile as Coronavirus reduces oil demand, sparking a price war between Saudi Arabia and Russia. On Monday, Brent crude fell 2.3% to $ 26 a barrel. Once down to 5%.