Indian domestic equity markets experienced a significant downturn in Wednesday's trading session, with both BSE Sensex and NSE's Nifty50 indices closing with substantial losses. The Sensex closed at 66,800.84, a drop of 796 points or 1.18%, while the Nifty50 ended at 19,901.40, plunging by 231.90 points or 1.15%.
The market witnessed an increased selling pressure that escalated in the latter half of the day due to a range of factors including weaker global cues and all-round selling. This exerted further pressure on the indices. The broader markets also experienced a downturn with BSE midcap and smallcap indices falling up to half a per cent each. The India VIX, a measure of market volatility, rose about 3% to reach 11.13.
In the sectoral landscape, all indices ended in red led by the Nifty metal index which declined about 2%. Financial Services, PSU bank, private bank and realty indices dropped more than a percent each. Other sectors such as oil & gas, auto, FMCG and healthcare also contributed to the market weakness.
Among individual stocks within the Nifty50 pack, HDFC Bank led the falls with a drop of about 4%. Other laggards included JSW Steel, Reliance Industries, Bharat Petroleum, UltraTech Cement, and Dr Reddy's Laboratories (NYSE:RDY), each declining more than 2%. State Bank of India, Hero MotoCorp and HDFC Life Insurance also ended lower.
Meanwhile, Power Grid and Coal India were among the gainers, increasing more than 2% and 1% respectively. ONGC and Asian Paints also added about a per cent each, while Sun Pharmaceuticals, Eicher Motors, NPTC and Axis Bank were also key gainers in the blue-chip index.
The market's attention is now focused on the outcome of the US Federal Reserve meeting, as well as future actions by other central banks. Investors have been taking profits due to high valuations after recent spikes and ahead of the US FOMC meeting on interest rates. The ongoing tension between the US and Canada may also impact the markets.
Rising US bond yields and a stronger dollar have exerted pressure on domestic markets. There are also concerns about the upcoming FED policy, the trajectory of interest rates and rising oil prices. The banking sector underperformed due to an increase in the cost of funds and a reduction in deposits leading to a moderation in net yield.
Cressanda Solutions dropped about 9%, while Ramkrishna Forgings, Indian Overseas Bank and UCO Bank fell by 6% each. The Central Bank of India declined by 5%, along with GMR Power & Urban Infra, MTNL and GTL Infra. Among the gainers in the broader market were EKI Energy Services which surged more than 19%, AGI Greenpac which increased about 17%, Blue Star and IFCI which gained over 13% each, National Peroxide which rose by 12%, and Precision Wires India which ended up 11% higher for the day.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.