Sensex slumps 984 pts to close at more than 4-month lows; banking, auto shares major drag

Mumbai: Benchmark Sensex plunged 984 points to close at a more than four-month low on Wednesday following heavy selling in banking, auto and capital goods shares amid retail inflation soaring to a 14-month high in October and unabated foreign fund outflows.

The BSE Sensex slid to 77,690.95, down by 984.23 points or 1.25 per cent, marking its second straight day of losses. During the day, it slumped 1,141.88 points or 1.45 per cent to 77,533.30.

Registering its fifth day of decline, the NSE Nifty tumbled 324.40 points or 1.36 per cent to 23,559.05, a level not seen since June 24, 2024.

From the 30-share Sensex pack, Mahindra & Mahindra, Tata Steel, Adani Ports, JSW Steel, IndusInd Bank, Reliance Industries, HDFC Bank and Kotak Mahindra Bank were the biggest laggards.

Tata Motors, NTPC, Hindustan Unilever, Asian Paints and Infosys were the gainers.

"Relentless selling by FIIs amid weak corporate earnings and a sharp surge in domestic inflation to a 14-month high have further impacted investor sentiment, dashing hopes for a near-term rate cut by the RBI," Vinod Nair, Head of Research, Geojit Financial Services, said.

Nair added that markets are jittery about future US policy actions, including trade-related implications for the world economy, which is reflected in a stronger US dollar and rising bond yields.

The latest data showed retail inflation breached the Reserve Bank's upper tolerance level, soaring to a 14-month high of 6.21 per cent in October, mainly on account of rising food prices.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,024.31 crore on Tuesday, according to exchange data.

Mid and small-cap stocks were the worst hit, while the financials and auto sectors also showed significant weakness. The BSE smallcap gauge tanked 3.08 per cent and midcap slumped 2.56 per cent.

All sectoral indices ended lower. Realty tumbled the most by 3.23 per cent, followed by industrials (2.95 per cent), capital goods (2.72 per cent), services (2.54 per cent), metal (2.54 per cent) and commodities (2.45 per cent).

A total of 3,299 stocks declined while 670 advanced and 98 remained unchanged on the BSE.

"Markets extended their corrective phase, declining by nearly one and a half per cent, continuing the existing downward trend," Ajit Mishra – SVP, Research, Religare Broking Ltd, said.

In Asian markets, Seoul, Tokyo and Hong Kong settled lower while Shanghai ended in the positive territory. European markets were trading higher.

The US markets ended in the negative territory on Tuesday.

Global oil benchmark Brent crude climbed 0.93 per cent to USD 72.56 a barrel.

The BSE benchmark tumbled 820.97 points or 1.03 per cent to settle at 78,675.18 on Tuesday. The Nifty tanked 257.85 points or 1.07 per cent to 23,883.45.