Sensex Plummets 1500 Points: New COVID Variant To Blame?

Photo courtesy: ANI

New Delhi: Indian stock markets fell on Friday over fears of a new COVID variant in South Africa that could be more infectious than Delta. The Sensex fell about 1500 points to 57,307 at day’s low while Nifty was struggling below 17200. “The news of the new covid variant has hammered confidence in equities, which were already under pressure as traders prepared for the Federal Reserve to start tightening its monetary policy to fend off surging inflation,” financial newspaper mint reported.

“Just as this particular tail risk was melting away into the background, scientists in South Africa have announced they have discovered a new Covid variant which could potentially be more transmissible. While the impact on human life is not yet established, the re-imposition of movement restrictions is likely to hurt economic activity. The South African Rand (ZAR) weakened past the 16 level for the first time this year,” Kristal.AI, a wealth management platform was quoted as saying in a note.

“There is fear of this new variant spreading to other countries which might again derail the global economy,” Hemang Jani, Head of Equity Strategy & Senior Group VP, Broking & Distribution, Motilal Oswal Financial Services was quoted as saying.