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Markets plunge amid Covid-19 resurgence

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Equity markets had a tumultuous week as benchmark indices plunged over 3% during the week. A number of reasons led to this. The resurgence of Covid-19 cases in some parts of India has spooked investors who thought that the pandemic was all but over. Moreover, global cues remained weak and Foreign Portfolio Investors reduced their pace of pouring money into Indian equities as valuations look seemingly high. Another reason could be the recent GDP data of the 4th quarter. Even though the economy expanded by 0.4%, it was below market expectations of a 0.5% expansion.

Before diving further into market updates, as usual, let’s look at interest fact for the week…

Matter of Fact

Just 1 year after launching the car business in 1998, Tata Motors received poor response from customers on its car – The Indica. Because of this, it had to sell its car business and turned to the American firm Ford to buy off its car division. Ford claimed that it was doing Tatas ‘a favour’ by buying this business.

Fast forward 9 years later, Ford was on the verge of bankruptcy – and guess who came to the rescue? Well, as karma has it, the Tata Group came in to buy off the Jaguar and Land Rover business from Ford and saved the company from going into liquidation.

@TataMotors had to sell its car business to Ford in 1998 and was humiliated by Ford for the same. 9 years later, as karma has it, Ford was on the verge of bankruptcy and @TataCompanies came to the rescue. Click To Tweet

Markets Update

Nifty50

14,529.15

3.02% ▼

Sensex

49,099.99

3.52% ▼

Nifty500

12,181.40

2.07% ▼

Nifty Bank

34,803.60

2.90% ▼

The Big Picture

India exited a technical recession as its GDP grew by 0.4% year-on-year in the 4th quarter of 2020, slightly below market forecasts of a 0.5% gain. This growth comes after the economy contracted for much of the past year due to the Covid-19 related lockdowns.
India’s infrastructure output, which measures the performance of industries like steel, coal, natural gas, electricity, etc. inched up for a second straight month and grew by 0.1% in January 2021 when compared to the same period last year.
India’s fiscal deficit, which is the difference between government revenues and expenses, ballooned to an all-time high of ₹12.34 lakh crores in April-January 2020-21.
As per RBI data, the value of commercial bank deposits and commercial bank loans grew by 11.8% and 6.6% respectively in the fortnight ended February 12th, 2021.

Ok, so?

India’s chemistry with Hydrogen

For the longest time now, human beings have relied on fossil fuels for our energy needs – and like we all already know, these aren’t sustainable. There has been a massive shift in how human beings plan on utilizing energy going forward. One such game-changer could be Hydrogen. Its the most abundant gas in the universe and India plans to look at Hydrogen to fulfil all its energy needs. Okay, so? Find out below!

#Hydrogen being used as a clean energy source is India’s newest strategy to become carbon neutral by 2050.

The government plans to make use of #GreenHydrogen a mandate for steel, fertiliser, and petrochemical industries.

Ok, so? Find out here👇🏻 pic.twitter.com/oyUkHULz0p
— smallcase (@smallcaseHQ) February 26, 2021

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And that’s a wrap for this week. Until next time… happy investing!

Abhishek Jadon

VP, Investment Products at Windmill Capital.

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