Black Thursday

Nifty50: 16,247▼ 815 (-4.7%)

Sensex: 54,529▼ 2,702(-4.7%)

• The markets opened with a big gap down and continued to slide throughout the day.
• All the 50 stocks of the Nifty50 pack ended in the red. 
• The India VIX spiked nearly 30%, indicating that the markets are gripped by fear. 
• The Russian Trading System (RTS) index plunged more than 40% as Russia announced military operations in Ukraine.

All the Nifty sectoral indices closed in the red, with PSU Bank (-5.0%) and Media (-4.8%) being the top losers.

For more updates on F&O, click here.

Here are the top stories of the day.

Dr Reddy’s slumps amid Russia-Ukraine crisis

The pharma major, which reportedly gets around 9% of its revenue from Russia alone, fell more than 2% today and hit a 52-week low of ₹4,050 after Russia ordered military operations in Ukraine. During FY21, its revenue from Russia was ₹1,580 crore, down 6% year-on-year due to the depreciation of the Russian ruble against the Indian rupee. 

Further, Ukraine was one of key markets among the CIS countries that drove revenue growth for the company. The stock has fallen nearly 17% since the start of 2022.

Tyre and paint stocks hit as oil rises

Shares of tyre and paint companies fell as crude oil hit $100 a barrel on concerns over supply-side disruptions. Non-natural rubber, which is derived from crude, is an important raw material for tyre manufacturers. Paint companies, on the other hand, use crude derivatives, and rising oil prices will increase their input costs and cut profit margins.

When crude oil prices go up, oil exploration and production companies like OIL and ONGC tend to benefit as they are able to sell oil at a higher price. 

Vodafone to sell Indus Towers stake to Bharti Airtel

As per reports, the British telecom giant is in discussions to sell around 5% stake in Indus Towers to Bharti Airtel. The stake is reportedly estimated to be around ₹3,300 crore, which will be pumped into the Indian entity, Vodafone Idea.

The development comes even as cash-strapped Vodafone Idea is facing intense competition and is losing subscribers to Bharti Airtel and Reliance Jio. Bharti Airtel is the largest shareholder in Indus Towers with a nearly 42% stake while Vodafone Group owns about 28%.

IPO Corner

The government had recently said that it will go ahead with the LIC IPO despite the market turmoil sparked by the Russia-Ukraine conflict. However, sources quoted in certain news reports also said that the government has time till the first week of March to decide on the LIC IPO. For more details on the LIC IPO, click here.

Good to know

What is Black Thursday?

Black Thursday is an infamous day in stock market history when the Dow Jones Industrial Average tanked 11% when markets opened on 24th October 1929. An unprecedented number of shares changed hands, and panic selling ensued throughout the day. It is also considered as the first day of the stock market crash of 1929, which lasted until 29th October, marking the end of a decade-long bull market and the start of the Great Depression.

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