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Yes Bank shares soar even as Sensex, Nifty plunge

MUMBAI: Yes Bank shares spurted 50 per cent after the government notified a rescue plan for the cash-strapped lender by the State Bank of India and other banks.

“The executive committee of the central board (ECCB) at its meeting held on March 11 accorded approval for the purchase of 725 crore shares in Yes Bank at a price of Rs 10 per share subject to all regulatory approvals,” SBI said in a regulatory filing.

The other lenders have also joined the rescue plan: HDFC and ICICI Bank will invest Rs 1,000 crore each, while Axis Bank and Kotak Mahindra Bank are planning to invest Rs 600 crore and Rs 500 crore, respectively.

Equity benchmark Sensex plummeted over 2,000 points and the Nifty gave up the 9,400 level in the opening session on Monday after the Federal Reserve’s rate cut fanned concerns over the impact of Covid-19 on the world economy.

The rupee too depreciated 41 paise to 74.16 against US dollar in the morning session. Resuming its downward spiral, domestic BSE Sensex sank 2004.20 points or 5.88 per cent to 32,099.28 in the morning session.

Similarly, the NSE Nifty cracked 596.25 points, or 5.99 per cent, to 9,358.95. In the previous session, the 30-share BSE barometer recovered over 5,380 points from its intra-day low of 29,388.97, ending 1,325.34 points or 4.04 per cent higher at 34,103.48.

The Nifty settled 365.05 points, or 3.81 per cent, up at 9,955.20. All Sensex components were trading in the red. IndusInd Bank was the top loser, tanking up to 12 per cent, followed by ICICI Bank, HDFC, Axis Bank, Titan, Tata Steel and Bajaj Finance.

According to traders, volatility heightened in global markets as the US Federal Reserve’s interest rate cut stoked concerns over an impending economic recession.

Faced with a growing economic shutdown amid the new coronavirus (Covid-19) pandemic, the US Fed on Sunday made its second emergency rate cut in less than two weeks, cutting the benchmark borrowing rate to a range of 0-0.25 per cent, where it was during the 2008 global financial crisis.

US stock futures fell sharply after the Federal Reserve slashed interest rates. Meanwhile, the Reserve Bank of India on Friday said it is closely monitoring the current global situation and assured that it will take all steps to keep markets adequately liquid and stable.

Further, Bank of Japan (BOJ) convened an emergency policy meeting after the Fed rate cut. A BOJ statement said the meeting was “to discuss monetary control matters based on recent economic and financial developments.”

Japan’s Nikkei was the sole Asian benchmark that did not lose ground early Monday. Elsewhere in Asia, Shanghai Composite Index, Hang Seng and Kospi fell up to 2 per cent. Incessant foreign fund outflow also kept market participants on edge, traders said. On a net basis, foreign institutional investors sold equities worth Rs 6,027.58 crore on Friday, data available with stock exchanges showed.

Meanwhile, Brent crude oil futures plunged over 2.98 per cent to USD 32.84 per barrel. Covid-19 has claimed over 6,000 lives and infected more than 1,62,000 people across the globe.

The number of infected cases in the country stood at 110 on Monday, the Union Health Ministry said.