Share markets in India have extended early gains and are presently trading 3% higher. Benchmark indices turned volatile and fluctuated between gains and losses as investors remained risk-averse amid escalating coronavirus cases, that rose to 195 in the country.
Barring realty stocks and banking stocks, all sectoral indices are trading in green with stocks in the energy sector, FMCG sector and IT sector witnessing most of the buying interest.
The BSE Sensex is trading up by 770 points while the NSE Nifty is trading up by 216 points. The BSE Mid Cap index is trading up by 2.9%, while the BSE Small Cap index is trading up by 2.2%.
The rupee is trading at 74.97 against the US$.
Speaking of the coronavirus impact on Indian stock markets, the chart below shows the trend in the total market capitalization of all BSE-listed companies since the start of 2020.
Coronavirus Triggers Massive Wipeout of Investor Wealth
As you can see, through most of January and February, the total market capitalization hovered between Rs 150-160 trillion.
It was only in the last week of February that a massive sell-off started on rising fears of the coronavirus outbreak escalating into a global pandemic.
So, what should you do in such times?
Emami share price is presently trading up by 6.8%.
Note that many companies are looking to buy their shares back from investors to boost shareholder confidence amid the brutal sell-off in the market.
In the past two weeks, Sun Pharma, Thomas Cook, Supreme Petrochem, Emami and S.P. Apparels have announced or proposed buybacks.
Sun Pharma's board on Tuesday approved the buyback of 40 million shares representing 1.67% of the total equity capital of the company at Rs 425 per share.
Thomas Cook has also received board approval for a buyback of up to 26 million shares at Rs 57.50 apiece for a maximum aggregate amount of Rs 1.5 billion.
In last year's budget, finance minister Nirmala Sitharaman had imposed a share buyback tax of 20% on listed companies.
We will keep you updated on how these buybacks sail through. Stay tuned for more updates from this space.
Moving on to news from the banking sector, shares of IDFC First Bank tanked 10% to hit a new low of Rs 18.60 today, after the bank's Managing Director and Chief Executive Officer (MD & CEO), V Vaidyanathan, sold 27.56 million shares for approximately Rs 580 million to close ESOP loan availed by him.
However, shares have recovered and are presently trading 2% higher.
The private lender informed the exchanges that Vaidyanathan intends to sell another about Rs 350 million worth of stocks today to entirely repay the residual ESOP (employee stock ownership plan) loan taken for exercising his ESOP shares to release his pledged shares.
In other news, HDFC Bank has allotted 14,17,156 equity shares to the employees of the bank pursuant to exercise of options under its Employees Stock Options Schemes (ESOS).
Shares of the private lender tanked nearly 8% in early trade today after brokerage Sanford C. Bernstein downgraded the stock to 'underperform' from 'market perform' and slashed the price target by nearly half to Rs 750 from Rs 1,400 earlier.
HDFC Bank share price is presently trading down by 3.7%.
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