Mumbai, 14th March 2020: Following the hyper volatility witnessed at the domestic market as a result of turmoil in stock markets across the globe, the Indian capital market regulator Securities and Exchange Board of India (Sebi) has assured the market participants that “All is Well” in the Indian markets and it is capable of withstanding all and any kind of shocks.
After the 10 per cent index based circuit breakers were applied on Friday and the trading was halted for 45 minutes, Sebi issued a statement assuring market participants.
Sensex and Nifty recovered after the latter hit 10 per cent circuit filter in early trade today. Weak sentiment on DalalStreet improved marginally after Sebi issued a statement.
It said, "Sebi and Stock Exchanges (Ses) have a robust risk management framework in place which automatically gets triggered in response to movements in the indices (BSE Sensex and NSE Nifty) as well as individual stocks both in cash and derivatives market."
On the market crash on Friday, the market regulator said, "Sebiand SEs are prepared to take suitable actions as may be required."
When the markets opened for trading on Friday, at 9:20 am, Nifty plunged 10 per cent to 8,625, down 966 points or 10.07 per cent. Sensex also plunged 3,090 points or 9.43 per cent in early tradecompared to its previous close of 32,778. This triggered a halt in trading for 45 minutes on both the SEs. At 10:5 am, Sensex was trading 110 points lower at 32,667 and Nifty was down just 96 points at 9,503.
In its statement, the market regulator said, "Over the last few days, Indian stock market has been moving in tandem with other global markets owing to concerns relating to COVID-19 pandemic, resultant fear of economic slowdown, recent fall in global crude prices, etc."
Sebi compared fall in global markets with domestic indices and said the crash in the Indian indices has been significantly lower than the stock markets in other countries.
In a move to instill confidence, Sebi said, stock markets in Russia (-36 per cent), Brazil (-36 per cent), France (-30.35 per cent), Germany (-29.43 per cent), Argentina (-29.31 per cent), UK (-28.12 per cent), Dow Jones, US (-25 per cent) have lost significantly when compared with Sensex (-19.51 per cent) and Nifty (-19.83 per cent) from January 31, 2020 to March 12, 2020.