March 20, 2020 / 6:03 AM / 14 days ago

Indian stocks take breather from virus-fueled selloff

BENGALURU, March 20 (Reuters) - Indian shares followed global equities higher on Friday after four sessions of bruising losses, as policymakers across the world launched fresh efforts to stem the economic fallout of the coronavirus pandemic.

World stocks recovered overnight from steep falls after central banks in Europe, Japan, Australia and the United States launched a fresh wave of stimulus to help businesses battered by a near halt in economic activity due to the virus outbreak.

India’s NSE Nifty 50 index, which fell as much as 1% earlier on Friday, was up 1.49% at 8,386.10 by 0600 GMT, while the S&P BSE Sensex was 1.52% to 28,717.22.

“We’ve already seen a sharp fall, and this is an intermittent bounce back due to value-buying and some short-covering,” said Siddhartha Khemka, head of retail research at Motilal Oswal Securities. “It is difficult to say if markets will sustain this momentum.”

Also aiding sentiment were reports that the U.S. Senate was debating a $1 trillion-plus package that would include direct financial help for Americans and that China was set to unleash trillions of yuan of fiscal stimulus.

The virus, which originated in China, has spread quickly around the globe, claiming more than 10,000 lives and hammering economic activity.

The carnage in financial markets has taken India’s blue-chip Nifty 50 index 33% below its Jan. 20 record intraday high, while India’s small-cap and mid-cap shares have fared no better, falling roughly 29% since the start of 2020.

The pandemic also threatens to chip away at India’s economic growth, already languishing at multi-year lows, as it forces more offices and factories into lockdown, pressuring corporate balance sheets. BofA Securities on Thursday cut its June-quarter growth projections for the country by 90 basis points to 3.1% as it forecast a global recession.

The rupee, which sunk to a new all-time low of 75.3525 against the dollar on Thursday, was last weaker by 0.25%.

State-run Oil and Natural Gas Corp led gains on the Nifty 50 with a 13.7% jump as oil prices bounced back.

The Nifty IT index jumped over 5%, with shares of Infosys and Wipro surging over 6% each.

Private sector lenders were among the top decliners on the Nifty 50. Shares in Indusind Bank and ICICI Bank slid 6% and 4%, respectively.

Shares in Interglobe Aviation, which runs India’s biggest airline IndiGo, touched a more than 1-year low as operations took a hit from the virus outbreak. (Reporting by Chandini Monnappa in Bengaluru; Editing by Shailesh Kuber)

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