Sensex halts 2-day gaining streak, falls 290 pts to close below 58K

MUMBAI : Equity benchmark Sensex declined 290 points in a volatile session to settle below the 58,000 mark on Thursday due to a sell-off in banking, financial and IT stocks amid a mixed trend in global equities.

Besides, heavy selling in index heavyweight Reliance Industries added to the pressure, traders said.

After rallying for two straight days, the 30-share BSE Sensex fell 289.31 points or 0.50 per cent to settle at 57,925.28, with 16 of its constituents posting losses. During the day, the index witnessed a high of 58,396.17 and a low of 57,838.85.

The broader NSE Nifty dipped 75 points or 0.44 per cent to end at 17,076.90, with 30 of its scrips ending in the red.

''Markets traded volatile and lost nearly half a per cent amid mixed cues. After the initial downtick, the Nifty recovered gradually in the first half however fall in the heavyweights around 17,200 levels again pushed the index in the red. Consequently, it closed at 17,076.90 levels.

''Continued pressure in the IT majors and profit-taking in banking and financial counters turned the tone negative,'' said Ajit Mishra, VP - Technical Research, Religare Broking Ltd.

State Bank of India was the biggest loser in the Sensex pack, shedding 1.69 per cent, followed by Asian Paints, Kotak Mahindra Bank, HCL Technologies, Reliance Industries, Wipro, IndusInd Bank, Infosys, Power Grid and HDFC twins.

In contrast, Nestle, Maruti, Bharti Airtel, Tata Motors, ITC and Hindustan Unilever were among the gainers.

In the broader market, the BSE midcap gauge declined 0.45 per cent and smallcap index dipped 0.15 per cent.

''Although the Fed's decision to increase rates by 25 basis points was in line with expectations, concerns were raised by the US Treasury Secretary's statement that blanket insurance for all deposits was not being considered. ''The domestic market attempted to recoup its initial losses with the help of favourable US futures as the Fed hinted at its plan to pause rate hikes sooner. However, the recovery was short-lived due to a sluggish start in the European market led by a 50 bps hike by the Swiss National Bank,'' said Vinod Nair, Head of Research at Geojit Financial Services.

Among indices, realty, bankex, IT, financial services, tech and consumer discretionary were the biggest laggards.

FMCG, healthcare, telecommunication, utilities and power were among the gainers.

As many as 2,053 firms declined, while 1,452 advanced and 129 remained unchanged. In Asia, Seoul, Shanghai and Hong Kong markets ended in the green, while Japan settled lower.

Equity markets in Europe were trading in negative territory during the afternoon trade. The US markets had ended sharply lower on Wednesday.

''Most Asian stock markets ended in the positive, while European markets were trading lower on March 23 as markets weighed the prospect of a less hawkish Federal Reserve against increased economic headwinds in the coming months.

''Investors felt that further increases, along with rates remaining higher for longer, are likely to apply increased pressure on the global economy this year,'' said Deepak Jasani, Head of Retail Research, HDFC Securities.

Meanwhile, global oil benchmark Brent crude dipped 0.90 per cent to USD 76 per barrel.

Foreign Portfolio Investors turned buyers on Wednesday as they bought equities worth Rs 61.72 crore, according to exchange data.

''Domestic equities swing between gains and losses after US Fed continued with its rate hike trajectory. Statement by Treasury Secretary to not provide blanket insurance to all the banks distraught the sentiments,'' Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said.

Their resolve to control inflation remains strong despite the ongoing banking turmoil. Bank of England is also expected to hike rates by 25 bps, Khemka said.

Overall, Indian markets are expected to remain range-bound due to a lack of triggers. The global environment continues to remain volatile. FIIs too have been consistent sellers for the last few days, which could keep the market under pressure, he added.