India's Stock Market Plummets As COVID-19 Raise Questions About The Economy

On Monday, Indian stocks dropped and the rupee fell as daily coronavirus infections hit a new high and new curbs were introduced in the financial capital of Mumbai, raising fears about the country's economic recovery. On Monday, India's coronavirus caseload surpassed 12.5 million for the first time, while the death toll surpassed 165,000.

The state of Maharashtra, which includes Mumbai, enforced strict restrictions, including a weekend lockdown. By 0450 GMT, the NSE Nifty 50 index had fallen 2.27 percent to 14,530.55, while the S&P BSE Sensex had fallen 2.37 percent to 48,843.65. Following a mostly in-line borrowing calendar, Indian bond yields were little changed as traders await the central bank's monetary policy decision on Wednesday.

The 10-year Treasury yield was 6.17 percent, down one basis point from the previous close. The partially convertible rupee, on the other hand, fell sharply, tracking a drop in the domestic stock market amid concerns about rising COVID-19 cases. It was trading at 73.40/41 per dollar, down from 73.1050 at the previous close.

The Nifty 50 was pulled down by private-sector lenders HDFC Bank, HDFC, and ICICI Bank, which dropped between 3.5 percent and 4 percent. The only stocks that benefited were software services stocks, which had been among the best performers for the majority of the pandemic in 2020. The Nifty IT services index rose 0.37 percent, with Infosys and Wipro each rising 1%.