Mumbai: Indian shares failed to maintain their early rally and extended their series of losses for the seventh consecutive month as panic-stricken investors sold their assets in the last hour of trading on Monday after the Department of Health reported two new cases of Covid 19.

In intraday trading, the Sensex benchmark rose 2.05% or 785.88 points and then dropped 3.31% or 1297.18 points from its daily peak. The 30 stock market index closed at 38,144.02, a drop of 153.27 points or 0.4%, while Nifty fell 0.62% to 11,132.75 points.

Other Asian markets found some calm on Monday when hopes of lowering global interest rates to ease the economic setback caused by the Covida 19 outbreak came true. Initially there was a further decline in Asia after China reported a record decline in refining activity, but the region experienced an increase due to lower bond yields and the debate over reduced OPEC supplies, leading to a 3.5% rise in crude oil prices. The extent of the losses in recent days has prompted investors to adopt a pricing policy from the Federal Reserve and the European Central Bank to the Bank of Japan.

According to analysts, new cases of the virus in India have led to a sharp decline in Indian stocks. The discovery of new cases of coronavirus in India has reversed the nascent decline in Indian equity markets, says Gaurav Dua, Head of Capital Markets Strategy and Sharekhan Investments at BNP Paribas. Despite the fact that new events are an alarming factor and volatility may persist in the short term, a correction of more than double digits offers an opportunity for investors.

India reported two more cases of Covida-19 on Monday, bringing the number of positive test results in the country to five.

The volatility index reached its highest level in 9 months on Monday. India’s volatility index, VIX, which reflects investors’ perception of volatility for at least one month ahead, was 25.20, an increase of 8.46%. The so-called fear index is generally inversely proportional to market movements.

(List: Sarvesh Kumar Sharma Coin)

(List: Sarvesh Kumar Sharma Coin)

Vinod Nair, director of research at Geojit Financial Services, said domestic production growth in February was weak. After reaching an eight-year high in January, growth in India’s industrial sector slowed in February as business sentiment cooled due to the fear of viruses. The purchasing managers index (PMI) for the Indian industry rose from 55.3 in January to 54.5 in February. In December, the value was 52.7. A number greater than 50 indicates expansion, while a pressure less than 50 indicates compression.

UBS analysts expect the economy to gradually recover to 5.6% over the course of the year, starting on 1 January. April, thanks to improved monetary transmission, support for government spending and the effect of a favourable base. We are aware of the risks involved in lowering our growth expectations. The slow recovery of economic activity in China has been accompanied by long interruptions in the supply chain. At the same time, the slowdown in strengthening the balance sheet of the financial sector and weak credit motivation could continue to weigh on the economy, according to the UBS report of 28 January 2009. February.

While UBS maintains its fundamental expectation that the Reserve Bank of India will reduce the pension rate by a further 25 basis points over the next fiscal year, it believes policymakers could consider a rapid reduction.

Meanwhile, the Indian currency closed at 72.73 per USD, the last time at the level of the 12. November 2018. The yield on ten-year government bonds fell by 2 basis points to 6.349% compared to the previous closing of 6.371%.

In February, the rupee weakened 0.3% against the dollar to 71.49, mainly as a result of the strengthening of the dollar in foreign markets after investors’ fears of a coronavirus outbreak had increased according to CARE’s assessments. On the other hand, the fall in world crude oil prices and the inflow of CPI (foreign portfolio investments) have limited the devaluation of the rupee.

Reuters contributed to this story.