Is HMPV A Likely Reason Why Stock Markets Crashed Today? Here's What Experts Have To Say

Around 12 noon, the Sensex crashed more than 1.3 per cent and plunged over 1,076 points. The Nifty also plummeted 1.35 per cent and declined more than 300 points. 

By 12:35 PM, the indices pared their losses slightly but continued to trade in negative territory.

Source : ABPLIVE AI

The stock market witnessed a major bloodbath on Monday as the key benchmark indices erased all gains by the afternoon. The BSE Sensex and NSE Nifty50 nosedived in the session as investors became extremely cautious. 

Around noon, the Sensex crashed more than 1.3 per cent and plunged over 1,076 points. The Nifty also plummeted 1.35 per cent and declined more than 300 points. 

By 12:35 PM, the indices pared their losses slightly but continued to trade in negative territory. The Sensex stood close to 950 points down and traded at 78,273.47 in the session, while the Nifty tested 23,700 and remained in red after taking a hit of close to 290 points.

The 30-share Sensex platform saw Titan, Infosys, TCS, Bajaj Finance, and ICICI Bank emerge among the gainers. While, Tata Steel, Kotak Mahindra Bank, Asian Paint, PowerGrid, and NTPC remained among the laggards during the session.

READ : 2 HMPV Cases In Infants Reported In India With No Travel History: Health Ministry

Could HMPV Be The Reason Behind The Fall?

The heavy sentiment in the market could be attributed to the concerns ahead of the Q3 earnings season, scheduled to begin this week. Further, the HMPV scare also likely weighed down on investors in the day. Foreign portfolio investors have maintained a cautious outlook towards Indian equities and this also heavily affected the sentiment among investors.

Reflecting on the bloodbath seen in the markets today, Kranthi Bathini, Director - Equity Strategy, WealthMills Securities Private Limited, said, “Yes, one of the reasons can be the HMPV virus also because we need to see how this new virus is going to impact our lives. It might be premature to say but investors and traders are acting a little bit cautious at this point in time and trying to book some profit from the table."

"Also, foreign portfolio investors are back and we need to see their activity and wait and watch. Most predominantly, FPIs selling is one of the reasons for today's sell-off," the expert noted. 

Rohit Beri, CEO and CIO at ArthAlpha, commented, "The Indian stock markets witnessed a significant sell-off today, with the Sensex dropping over 1,200 points and the Nifty 50 falling by approximately 1.4 per cent, amid a broad-based decline across key sectors. Indian equities are in the consolidation phase amid headwinds from muted earnings and post-Trump uncertainty. Today's sharp down move can be explained in the light of the disappointing HDFC Bank earnings outlook combined with heightened investor anxiety following reports of Human Metapneumovirus (HMPV) cases in Bengaluru, raising fears of potential public health and economic repercussions. Similar to past viral outbreaks, concerns about the virus transmission and its impact on business continuity, consumer behaviour, and market stability have triggered risk aversion among market participants."

Vaibhav Vidwani, Research Analsyt, Bonanza, further explained that the markets have been under significant pressure from the Foreign Institutional Investors (FIIs) who have selling consistenly. "This selling trend is expected to continue until there is more clarity on economic conditions and currency stabilisation. The dollar index has risen sharply, reaching levels not seen in two years. The US Federal Reserve attributes this increase to expectations of fewer interest rate cuts. A strong dollar typically leads to outflows from emerging markets like India as investors seek safer assets. Ongoing geopolitical issues and uncertainties surrounding global trade policies have added to market volatility. The anticipation of policy changes under the incoming US administration has also created unease among investors," he stated.

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