MUMBAI: Benchmark BSE Sensex plummeted by nearly 383 points in a volatile trade on Tuesday due to losses in index heavyweights TCS, Reliance Industries and HDFC Bank amid a massive selloffs in global markets triggered by deepening geopolitical tensions.
After sinking about 1,300 points in early deals, the 30-share barometer finally closed lower by 382.91 points or 0.66 per cent at 57,300.68 points.
The broader NSE Nifty too reclaimed part of its early losses before closing 114.45 points or 0.67 per cent lower at 17,092.20.On the Sensex chart, Tata Steel fell the most by 3.64 per cent, followed by TCS (3.59 per cent), and SBI (2.67 per cent).
Dr Reddy's dropped 2 per cent, ITC by 1.44 per cent, Bharti Airtel by 1.39 per cent, and IndusInd Bank by 1.39 per cent. Reliance Industries, HDFC Bank, Axis Bank, HCL Tech, Wipro, HUL, LT and UltraTech were among the losers. Of the 30 Sensex constituents, 20 closed in the red.
"Escalations in Ukraine tensions with Russia recognising two pro-Russian rebel regions have aggravated the crisis. The economic consequences are already visible in higher crude and gold prices," VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.
The biggest macro headwind for India is crude racing to USD 97 a barrel, he said, adding that the inflationary consequence of this will force the RBI to abandon its dovish monetary stance.
Continuing their selling spree, foreign institutional investors sold shares worth Rs 2,261.90 crore in the Indian capital market on Monday, exchange data showed.In a sign of aggravating geopolitical crisis in the eastern Europe, Russian President Vladimir Putin has recognised the independence of separatist regions in eastern Ukraine.
Putin's announcement comes after a meeting of the presidential Security Council and paves the way for Russia to openly send troops and weapons to the long-running conflict pitting Ukrainian forces against Moscow-backed rebels.
Meanwhile, India has also expressed deep concerns over the escalation of tension along the Russia-Ukraine border and said the developments have the potential to undermine peace and security of the region.
Sectorally, BSE realty index tumbled over 3 per cent, followed by industrials, metal and teck.Of the 19 sectoral indices, 17 closed in the red.Broader smallcap, midcap and largecap indices dropped as much as 1.62 per cent.
S Ranganathan, Head of Research at LKP securities said, "The Trend is your Friend and the street keeps reminding investors and traders just how tough it is to focus on the famous quote of Peter Lynch when you have a confluence of factors swaying you away from your investee companies.
"Just when the global economy is beginning to recover and normalise from the impact of the pandemic, Russia has recognised the independence of separatist regions in Ukraine thereby inviting the possibility of severe sanctions being imposed by the US & EU." Vinod Nair, Head of Research at Geojit Financial Services said escalation in Russia-Ukraine issue and a sharp surge in oil prices forced global markets to plunge sharply.
Indian equities opened with heavy losses tracking overnight fall in the global market and its adverse spill over to commodity prices. "However, the domestic market managed to trim down its losses during the late session.Continued offload by FIIs has increased volatility while DIIs are adding position", Nair said.
Other Asian bourses on Tuesday followed Wall Street rout and massive selloffs in European equities triggered by the Russia-Ukraine standoff. Tokyo's Nikkei 225 declined 1.7 per cent while the Hang Seng in Hong Kong closed lower by 2.7 per cent.
South Korea's Kospi lost 1.4 per cent and the Shanghai Composite index fell 1 per cent.Tracking the Ukraine crisis, Brent crude futures rose 4 per cent to USD 97.35, the highest since September 2014.