Sensex, Nifty in red for fifth straight session: Top reasons behind this downtrend

NEW DELHI: Equity indices fell for the fifth straight session on Thursday as investors shunned riskier assets on fears that the coronavirus outbreak is fast developing into a pandemic. The benchmark BSE index slipped 143 points or 0.36 per cent to close at 39,746; while the broader NSE Nifty settled 45 points or 0.39 per cent lower at 11,633. Banking and realty stocks were the most affected.
Sensex had closed below 40,000-mark on Wednesday for the first time since the steep fall witnessed after Union Budget earlier this month.In the last five sessions, the BSE bellwether has lost 1,424 points.
Major laggards in the BSE pack include ONGC, HCL Tech, SBI, ICICI Bank, IndusInd Bank and Hero MotorCorp with their shares falling as much as 3.03 per cent. On NSE, except for Nifty FMCG (fast-moving consumer goods) and Pharma, all other sub-indices finished in red with Nifty PSU Bank and Realty down as much as 2.42 per cent.
Here are the key reasons behind the slide:
Coronavirus spreading faster:
The coronavirus (Covid-19) has in recent days spread far beyond China, where it emerged late last year, apparently in a market selling wildlife in the city of Wuhan. Most new virus cases are now being reported outside China with South Korea, Italy and Iran emerging as new epicentres. US officials on Wednesday warned Americans to prepare for more virus cases.
With around 82,000 infection cases globally, the deadly virus has claimed 2,800 lives so far.
GDP growth forecast:
Market participants also turned cautious after State Bank of India (SBI) economists expected that the GDP (gross domestic product) growth will stay flat in the October-December 2019 period. The figure came at 4.5 per cent in the July-September quarter, weakest expansion in over six years. The Q3 economic growth number is scheduled to be released on Friday.
The National Statistics Office (NSO) has cut its growth projection for the fiscal year 2019-20 to 5.0% from 6.1% previously.
F&O expiry:
There was also a sense of volatility ahead of the derivatives expiry with traders looking to place their positions from February series to March 2020 series. With the expiry of futures and options, most investors will try to exit their positions, AK Prabhakar, head of research at IDBI Capital, told news agency Reuters.
FIIs on a selling spree
According to some analysts, intense spread of coronavirus is pushing investors away. There is sharp foreign fund outflow led by strong dollar index, as investors reduce their exposure to emerging markets amid global uncertainty.
On a net basis, foreign institutional investors sold equities worth Rs 3,336.60 crore, while domestic institutional investors bought shares worth Rs 2,785.67 crore on Wednesday, data available with stock exchanges showed.
(With agency inputs)