- Reliance Industries went down by 10% – the biggest single-day fall in the last 10 years.
- Shares of Reliance Industries hit an intraday low of ₹1,143
But today, the company witnessed something different and disheartening. Shares of Reliance Industries witnessed the biggest single-day loss and fell sharply after crude oil prices crashed in the international market.
Reliance Industries – the operator of the world’s largest crude oil refining facility at Jamnagar and operator of KG-D6 basin in Krishna Godavari basin, its shares went down as much as 13.65%.
Shares of Reliance Industries going down this time is said to be the biggest single-day fall in the last 10 years. Shares hit as low as ₹1096.65 as per data from BSE showed.
It’s Not Only About Shares of Reliance Industries:
Crude oil is something that is a necessity for any economy. Any company associated with the production; extraction of crude oil is definitely said to be affected if any speculation is observed.
It’s like a bull-whip effect. It might begin somewhere, in some corner of the international market, but as soon as anything like this happens, it has the potential to move all the companies associated with the crude oil speculation.
After shares of Reliance Industries going down, state-run ONGC also slipped as much as 13% to hit an intra-day low of ₹77.80.
After the disintegration of the Organization of the Petroleum Exporting Countries (OPEC), + alliance triggered an all-out price war between Saudi Arabia and Russia (which is likely to happen due to political and economical consequences).
Crude oil fell the most since 1991 on Monday after Saudi Arabia started a price war with Russia by cutting its selling price and pledging to uplift its supply which was affected due to coronavirus outbreak.
Brent crude futures fell by as much as $14.25 (which was previously $31.02) a barrel. The biggest percentage drop from 17th January 1991.
What Exactly is The Movement in The Equity Market?
Had it been just about shares of Reliance Industries, there wouldn’t be this much movement in the market. But since all the crude oil companies are stuck between the on-going war of Saudi Arabia with Russia, there was a heavy movement.
As shares of various crude oil companies go down, the equity market is all set to experience heavy selling now and then. More than 4% tracking a selloff in the global market, as investors panicked about the severity of coronavirus pandemic amid fear of recession.
As of 12:31 pm, Reliance Industries traded 9% lower at ₹1,155 and ONGC dropped to ₹78.10, underperforming the Sensex which overall went down by 4.3%.
Now when the entire market of crude oil is suffering due to 2 nations at silent war, there will be a lot of movement for short-sellers. But here is the lesson, short bummers is the indication that in the long-run (let’s not talk about in a number of years) all the companies are said to rise up.
While the shares of Reliance Industries witness a 10-year drop, maybe it is a good time for investors to buy its shares but only for long term view. As of now, it remains bad news for short-sellers.
However, if we talk only about Reliance Industries, things might not be in their favor every time. And it’s natural that every smooth ride comes with some bumps, jerks, and stoppages.