Negative global cues, along with profit booking and a weak rupee, dragged the key Indian equity markets lower on Thursday.
The benchmark indices closed the day's trade in the red, after some handsome gains the previous day.
Around the afternoon session, the key equity index plunged over 400 points, as heavy selling pressure was witnessed in banking, automobile and capital goods stocks.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) edged down by 65.85 points or 0.80 per cent, at 8,140.75 points.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 26,686.03 points, closed at 26,525.46 points -- down 200.88 points or 0.75 per cent from the previous close at 26,726.34 points.
The Sensex touched a high of 26,686.03 points and a low of 26,314.91 points during intra-day trade.
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The BSE market breadth was skewed in favour of the bears -- with 1,650 declines and 940 advances.
Both the key Indian indices during the previous trade sessionon Wednesday ended on a higher note. The barometer index urged by 330.63 points or 1.25 per cent, while the Nifty rose by 97.75 points or 1.21 per cent.
In terms of broader markets, both the midcap and smallcap indices closed lower by 0.37 and 0.55 per cent respectively.
Initially, the equity markets opened on a negative note in sync with their Asian peers, which had receded after the Bank of Japan (BoJ) decided against an increase in its stimulus measures.
Apart from BoJ, the US Federal Reserve also dampened sentiments as it reduced US economy's growth forecast.
Further, the US Fed decided to maintain its key lending rates at the conclusion of its two-day policy meet that ended late Wednesday.
The US Fed also signalled its intention to limit the times it might increase key lending rates due to weak domestic jobs market.
Besides, disappointing macro-economic trade data which showed a decline in exports for the 18th consecutive month in May further panicked investors.
In addition, lower global crude oil prices and a weak rupee curtailed investors risk taking appetite.
However, a late spurt of value buying triggered short covering which aided the equity markets to pare some of their losses.
"Negative global cues spooked investors into some early liquidation of positions," Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services, told IANS.
"Lower crude oil prices and moderately weaker rupee too dented investors' sentiments," he added.
Dhruv Desai, Director and Chief Operating Officer of Tradebulls, said that Nifty opened down tracking negative global cues but recovered from day's low in the second half of the session due to short covering at lower levels from traders.
"Banking sector stocks witnessed handsome recovery from day's low on fresh buying support and ended on a positive note," Desai pointed out.
Both the foreign and domestic institutional investors (DIIs) were net sellers during the day's trade.
Data with stock exchanges showed that the foreign institutional investors (FIIs) sold stocks worth Rs 156.75 crore, whereas DIIs divested scrip worth Rs 163 crore.
Sector-wise, all the sub-indices except metal stocks witnessed heavy selling pressure.
The S&P BSE banking index plunged by 283.42 points, followed by the automobile index, which declined by 177.09 points, and the capital goods index fell by 151.72 points.
On the other hand, the S&P BSE metal index rose by 33.96 points.
Major Sensex gainers during Thursday's trade were GAIL, up 1.08 per cent at Rs 382.35; Asian Paints, up 0.85 per cent at Rs 1,006.80; Wipro, up 0.59 per cent at Rs 549.85; Hindustan Unilever, up 0.56 per cent at Rs 879.75; and Tata Motors, up 0.40 per cent at Rs 454.
Major Sensex losers during the day's trade were Maruti Suzuki, down 2.93 per cent at Rs 4,084; Bharti Airtel, down 1.58 per cent at Rs 346.25; ICICI Bank, down 1.54 per cent at Rs 239.60; NTPC, down 1.43 per cent at Rs 151.75; Hero MotoCorp, down 1.41 per cent at Rs 3,023.40.
--IANS
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