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Omicron virus concerns drive Indian equity markets down

By Munikoti Rochan

11:19, 6 December 2021

A stock market chart highlighting weak trading
Omicron fears lead to Indian benchmarks shedding the most in 10 days – Photo: Shutterstock

Indian shares dropped the most in 10 days, finishing lower for a second straight session on Monday, pulled down by mounting concerns that rising coronavirus infections could once again disrupt economic activity.

The benchmark equity indices tumbled 1.65% each through the day. While the National Stock Exchange’s (NSE) Nifty50 ended at 16,912.25 points, the S&P BSE Sensex closed at 56,747.14 points.

Sectoral indices across the NSE were in the red on 6 December.

  • The Nifty IT index, comprising 10 technology firms including software developer Coforge, dropped 2.7%
  • The Nifty Pharma index, a basket of 20 drug manufacturers including Divi’s Laboratories, plummeted 1.87%
  • The Nifty Auto index, a basket of 15 automotive firms including tyre maker Balkrishna Industries, fell 1.84%

The Indian rupee was trading 0.21% lower to the US dollar, to INR75.40 as of 16:40 hours local time (UTC+5:30).

On the Nifty50

Chemicals manufacturer UPL was the sole gainer, rising 0.44% despite the downbeat sentiments.

Meanwhile, IndusInd Bank, Tata Consumer Products and insurance provider Bajaj Finserv were the top losers, shedding 3.7%, 3.36% and 3.27% respectively.


146.85 Price
-0.960% 1D Chg, %
Long position overnight fee 0.0113%
Short position overnight fee -0.0195%
Overnight fee time 22:00 (UTC)
Spread 0.090


1.27 Price
+0.640% 1D Chg, %
Long position overnight fee -0.0046%
Short position overnight fee -0.0036%
Overnight fee time 22:00 (UTC)
Spread 0.00170


0.67 Price
+1.060% 1D Chg, %
Long position overnight fee -0.0073%
Short position overnight fee -0.0009%
Overnight fee time 22:00 (UTC)
Spread 0.00040


0.67 Price
+1.060% 1D Chg, %
Long position overnight fee -0.0073%
Short position overnight fee -0.0009%
Overnight fee time 22:00 (UTC)
Spread 0.00040

On the Sensex

All 30 counters crashed.

Stocks in IndusInd Bank, Bajaj Finserv and the nation’s second-largest telco Bharti Airtel (Airtel) were the biggest losers, shedding 3.75%, 3.43% and 2.96% respectively.

RBI to hold rates

“Whereas many EM (emerging market) central banks have been hiking rates aggressively, the Reserve Bank of India (RBI) has been taking only baby steps towards policy tightening over the past couple of months,” said London-based research firm Capital Economics’ senior India economist Shilan Shah.

“And the emergence of the Omicron Covid-19 variant only reinforces our view that it will continue to move very cautiously. In all, we think the Monetary Policy Committee (MPC) will announce further small measures to drain liquidity from the banking sector at the conclusion of its policy meeting on Wednesday 8 December as it continues to lay the groundwork for policy rate hikes from mid-2022,” Shah wrote in a 1 December note to clients, published on his firm’s website.

Read more: Indian equities to take cues from rate move, Omicron spread

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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