Domestic equity benchmark BSE Sensex fell over 250 points in early trade Tuesday dragged by losses in HDFC twins and TCS as Budget tax proposals continued to spook investors.
After dropping over 253 points in opening session, the 30-share index pared some losses to trade 152.50 points, or 0.39 per cent, lower at 38,568.07 at 0930 hours. Similarly, the broader Nifty shed 49.25 points, or 0.43 per cent, to 11,509.35.
TCS was among the top losers in the Sensex pack, falling up to 1.79 per cent, ahead of its quarterly results, scheduled to be announced later in the day.
HDFC twins, Asian Paints, Kotak Bank, HUL, Bajaj Finance and Axis Bank too fell up to 2.19 per cent.
On the other hand, Yes Bank, PowerGrid, Sun Pharma, NTPC, L&T, RIL and Vedanta were among the gainers, rising up to 2.90 per cent.
In the previous session, the 30-share gauge saw its biggest single-day loss this year so far, settling at 38,720.57 points, showing a sharp loss of 792.82 points or 2.01 per cent. The Nifty too tanked 252.55 points, or 2.14 per cent, to close at 11,558.60 points.
On a net basis, foreign institutional investors sold equities worth Rs 401.99 crore, while domestic institutional investors purchased shares to the tune of Rs 321.13 crore, provisional data available with stock exchanges showed Monday.
The Union Budget proposal to raise the public shareholding threshold to 35 per cent from the current 25 per cent and higher tax incidence for foreign portfolio investors and high networth individuals kept investors jittery, traders said.
“Fiscal prudence (in the Budget) was contrary to the market’s expectation which was hoping for a stimulus in the slowing economy,” said Vinod Nair, Head of Research, Geojit Financial Services.
Focus has shifted to the upcoming quarter result where expectation remain muted, volatility is likely to prevail, he added.
Persistent weakness in global equities amid expectation of dovish US Federal Reserve policy too weighed on investor sentiment here, they added.
Shanghai Composite Index, Hang Seng and Kospi were trading lower in their respective early sessions, while Nikkei was trading in the green.
Meanwhile, the global oil benchmark Brent crude futures were trading 0.22 per cent lower at 63.97 per barrel.
Rupee falls 18 paise to 68.84 against dollar
The rupee Tuesday declined by 18 paise to 68.84 against the US currency in early trade, due to strong dollar demand from banks and importers amid persistent foreign fund outflows.
A strengthening dollar against major currencies overseas and weak domestic equity market weighed on the local unit, forex traders said.
However, softening crude oil prices restricted the rupee’s fall, they added.
The rupee opened weak at 68.65 (rpt) 68.65 against the US dollar at the interbank forex market. It fell further to quote at 68.84, registering a decline of 18 paise from the previous close.
The domestic currency on Monday fell 24 paise to close at 68.66 against the US dollar.
Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 401.99 crore Monday, while domestic institutional investors bought shares worth Rs 321.13 crore, as per provisional data.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose by 0.03 per cent to 97.41.
Meanwhile, brent crude futures, the global oil benchmark, declined 0.45 per cent to trade at USD 63.82 per barrel.
The 10-year government bond yield was at 6.58 per cent in the morning trade.