Indices at Dalal Street continued to sink further amid the fears of Covid-19 pushing the economies to a global recession. Indian stock markets followed selloff in global equities and tanked more than 2700 points to 31,390 while the broader Nifty tanked below 9,200. The sell-off resulted in investors losing as much as Rs. 8 lakh crore in one trading session. The sell-off has continued even as major central banks across the globe have announced fresh spur measures to prop up a global economy effected by the coronavirus outbreak.

Banks' stocks fell off the cliff

The financial and metal scrips led the sell-off at Dalal Street with IndusInd Bank falling 18% while Infosys, Tata Steel, HDFC, Axis Bank and ICICI Bank witnessed a fall around 9 to 10 percent. Much anticipated debut of SBI Cards did not receive investors' interest as it opened up for trade for the first time with a 10% discount as compared to its issue price of Rs. 755.

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A man walks past a screen displaying news of markets update inside the Bombay Stock Exchange (BSE) building in Mumbai, February 6.Reuters

A report in financial daily Mint highlighted that markets around the world witnessed a bloodbath with European markets tanking 8-9 percent. The US futures also sank around 5 percent hitting the lower circuit.

US Fed-Reserve announces a rate cut

The selloff continued even after the US Federal Reserve slashed the borrowing rates almost near zero which is its second cut in less than a fortnight. Moreover, the Fed-Reserve also announced a massive asset-buying program, a move it last took during the financial crisis of 2008 to calm the investors' nerves. But it seems the markets across the globe have set its own course due to coronavirus outbreak with the financial markets globally witnessing huge volatility.

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An Indian broker reacts while trading at a stock brokerage firm in Mumbai,Reuters file

"The markets are showing no signs of stability as the economic impact of the Coronavirus is likely to be significant for many major economies. Even after the US Fed's slashing of interest rates to a range of 0% to 0.25% and the introduction of a USD 700 billion stimulus program, investor sentiments remain weak," Moneycontrol quoted Ajit Mishra, VP Research, Religare Broking as saying. He further went on to add, "On the domestic front too, certain measures are expected from the government and RBI to protect the economy. However, given the uncertainty and increasing spread of the virus domestically, we expect that current choppiness could continue in the coming days."