Taking Stock | Stocks fall like ninepins as volatility index jumps 25%; investors lose Rs 6.64 lakh crore

Indian equities fell like ninepins on December 21 as reports of a new and virulent COVID-19 strain in the UK spooked investors.

A new variant of the novel coronavirus has been identified in the United Kingdom. England’s Chief Medical Officer Chris Whitty said on December 19 that the new variant of the coronavirus, which causes COVID-19, can spread faster.

As per media reports, Prime Minister Boris Johnson was to chair a crisis meeting on December 21 as a growing number of countries blocked flights from Britain over a new highly infectious coronavirus strain the UK said was "out of control".

Equity barometer Sensex fell 2,038 points, while the Nifty touched 13,131.45 on the downside in intraday trade.

Sensex closed at 45,553.96, down 1,407 points, or 3 percent, and the Nifty settled at 13,328.40, down 432 points, or 3.14 percent.

BSE midcap and Smallcap indices cracked 4.14 percent and 4.57 percent, respectively.

The sharp selloff dealt a strong blow to investor wealth as the overall market capitalisation of BSE-listed firms dropped to Rs 178.75 lakh crore against Rs 185.39 lakh crore in the previous session, making investors poorer by Rs 6.64 lakh crore in a single day.

"The new variant of the Novel Coronavirus in the UK spooked markets as we witnessed intense selling in pivotal throughout afternoon trade. While the street was bracing for a correction this week after a sharp up move, the sheer velocity of the fall across broader markets took the bulls by surprise as practically none of the key indices constituents were in the Green today," said S Ranganathan, Head of Research at LKP Securities.

Index	Prices	Change	Change%
Sensex	84,211.88	-344.52	-0.41%
Nifty 50	25,795.15	-96.25	-0.37%
Nifty Bank	57,699.60	-378.45	-0.65%

Nifty 50 25,795.15 -96.25 (-0.37%)

Fri, Oct 24, 2025

• 1D
• 5D
• 1M
• 3M
• 6M
• 1Y
• 2Y

Biggest Gainer	Prices	Change	Change%
Hindalco	824.45	32.05	+4.04%

Biggest Loser	Prices	Change	Change%
Cipla	1,584.40	-60.70	-3.69%

Best Sector	Prices	Change	Change%
Nifty Metal	10347.50	105.60	+1.03%

Worst Sector	Prices	Change	Change%
Nifty FMCG	56348.10	-424.30	-0.75%

Volatility index India VIX jumped 24.52 percent, indicating strong nervousness among investors.

"A new and faster-transmitting strain of the virus in the UK is an area of concern. This has led to further restrictions on travel and economic activity. Acceleration in the number of cases in the US and poor economic data are other dampeners," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"High valuation continues to be a concern in India but the power of FII-driven liquidity is overwhelming all negative news. Investors should exercise caution."

Vinod Nair, Head of Research at Geojit Financial Services does not expect a big correction rather a consolidation, in the short-term, of not more than 7-10 percent in the main indices.

"Buying on dips can be considered as a strategy in the falling market," said Nair.

Sectors and stocks

Among the sectors, Nifty PSU bank cracked around 7 percent, while NIfty Media fell over 6 percent. Nifty Auto, Bank and Metal indices fell up to 5 percent.

In the Nifty PSU Bank index, shares of Canara Bank and Indian Bank fell over 10 percent each.

A volume spike of more than 200 percent was witnessed in the stocks of Lupin, Glenmark Pharma, Larsen & Toubro, Adani Ports, Max Financial Services and Godrej Consumer Products.

Short build-up was seen in stocks such as Vedanta, RBL Bank, BHEL, IndiGo and Federal Bank.

As many as 90 stocks fell more than 10 percent on BSE.

Nearly 500 stocks, including SpiceJet, Equitas, Hindustan Copper, Future Consumer, GE Power India, Welspun India, Adani Power, Edelweiss Financial Services, hit their lower circuits on BSE.

Technical view

Nifty formed a big red candlestick formation on the daily chart, erasing the gains of the last 11 days.

Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities pointed out since the market formed a higher bottom at 12,790 on November 26, it has never given any decisive candlestick pattern on the daily basis.

Despite the upward trend and gains of 1,000 points in the last 15 days, Nifty made multiple indecisive candles in between. That indecisiveness finally resulted in today’s vertical fall.

"It’s a bearish reversal formation of the short-term. Nifty could slide to either 13,000, where it has support as per Options data or 12,500, which was the highest point of the previous up-move (all-time highest levels on Nifty till January 2020)," said Chouhan.

"On the higher side, 13,400-13,500 would be hurdle zone. Reduce weak long positions between 13,400-13500 levels. Only strong markets can cross and close above 13,500 levels. Strong buying opportunity is there between 12,700-12,600 levels for the medium-term investors," Chouhan said.

Chandan Taparia, Vice President | Analyst-Derivatives of Motilal Oswal Financial Services said mechanical indicators are turning negative from their overbought territory so one needs to stay light till Nifty doesn’t get stability.

"Till it doesn’t surpass 13,450-13,500 zone, profit booking declines could be seen towards 13,131 and 13,000," he said.

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