Sensex drops over 200 pts in early trade; Nifty slips below 13,700

Mumbai: Equity benchmark Sensex dropped over 200 points on Monday, tracking weak cues from global markets amid concerns over a new strain of the virus leading to fresh restrictions in European countries.

The 30-share BSE index pared the gains to trade 202.44 points or 0.43 per cent lower at 46,758.25.

Similarly, the broader NSE Nifty slipped 66.75 points or 0.49 per cent to 13,693.80.

M&M was the top laggard in the Sensex pack, shedding around 2 per cent, followed by ICICI Bank, PowerGrid, Axis Bank, SBI, ONGC and IndusInd Bank.

On the other hand, L&T, Reliance Industries, Sun Pharma, Infosys and HCL Tech were among the gainers.

In the previous session, Sensex settled at a record 46,960.69, up 70.35 points or 0.15 per cent, while Nifty rose 19.85 points or 0.14 per cent to 13,760.55 — its new closing high.

Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 2,720.95 crore on a net basis on Friday, according to provisional exchange data.

According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, a new and faster-transmitting strain of the virus in the UK is an area of concern. Acceleration in the number of cases in the US and poor economic data are other dampeners.

A number of European countries have banned flights from the UK as the British government warned that the potent new strain of the virus was “out of control” and imposed a stringent new stay-at-home lockdown from Sunday.

However, the US Congress agreement on USD 900 billion of fiscal stimulus is likely to support markets. High valuation continues to be a concern in India. But the power of FII-driven liquidity is overshadowing all negative news, he added.

Elsewhere in Asia, bourses in Seoul, Hong Kong and Tokyo were in the red in mid-session deals, while Shanghai was trading with gains.

Meanwhile, the global oil benchmark Brent crude futures were trading 3.20 per cent lower at USD 50.59 per barrel. (PTI)