Aggressive selling by foreign funds on tax concerns bogged down markets today as the benchmark BSE Sensex plunged by more than 555 points to over three-week low of 27,886.21, while sharp fall in heavyweights like RIL, Infosys and weak global cues added to the fall.
The 50-share Nifty nosedived 157.90 points to close below 8,500-mark. The index had closed at 8,341.40 on March 27.
Lower closing in other Asian markets combined with India's exports falling 21 per cent in March to a six-year low also weighed on markets, traders said.
In a report, global brokerage firm UBS cut its Nifty target for December this year to 9,200 from 9,600 amid slower-than-expected recovery in growth.
The bullish trend in Indian markets over the last one year was mainly driven by "positive surprise on rate cycle, lower oil prices and reforms news-flow" but hereon, actual earnings and macro data points would matter increasingly, UBS said.
"The revised target also reflects our view of the growth recovery being slower-than-expected, as is playing out in quarterly corporate results," it added.
The 30-share Sensex opened up more than than 95 points, but on emergence of profit-booking in realty, FMCG and IT it dipped to the session's low of 27,802.37. The barometer finally settled the day lower by 555.89 points or 1.95 per cent at 27,886.21.
This was the fourth consecutive session of downtrend in the 30-share index, which has now lost around 1,160 points since crossing 29,000-levels last Monday.
The 50-share NSE Nifty plunged by 157.90 points or 1.83 per cent to close at 8,448.10, while moving between 8,619.95 to 8,422.75 intraday.
Concerns by foreign investors over retrospective taxation weighed on trading sentiments, traders said.
RIL was the worst performer on Sensex and Nifty with over 4.40 per cent plunge. It had posted 8.5 per cent fourth quarter profit growth after market hours last Friday.
"While the expectations from the results are already low, concerns with respect to the delayed recovery in corporate earnings in the backdrop of a slower-than-expected economic recovery has overtaken sentiments in the short-term," said Hitesh Agrawal Head of Research at Reliance Securities.
Out of 30 Sensex stocks, 28 ended in negative zone, while only Sun Pharma and ICICI Bank managed to rise.
Sectorwise, the BSE realty index suffered the most by losing 2.78 per cent, followed by FMCG 2.71 per cent, capital goods 2.17 per cent, IT 2.08 per cent, power 2.04 per cent and oil and gas 1.91 per cent.
