MUMBAI: Equity benchmarks spiralled lower for the third session on the trot on Friday, in lockstep with a sell-off in overseas markets as investors fretted over the global economy slipping into a recession amid rate hikes by central banks.
A weak rupee and foreign fund outflows added to the woes, traders said. The 30-share BSE Sensex tanked 1,093.22 points or 1.82 per cent to settle at 58,840.79. During the day, it tumbled 1,246.84 points or 2 per cent to 58,687.17.
Similarly, the broader NSE Nifty declined 346.55 points or 1.94 per cent to close at 17,530.85. UltraTech Cement was the top laggard in the Sensex pack, slumping 4.51 per cent, followed by Tech Mahindra, Infosys, M&M, Wipro, TCS and Nestle India.
IndusInd Bank emerged as the sole gainer, spurting 2.63 per cent.
"With persistent bearish pressure from global stocks amid rising yields and dollar index, the domestic market surrendered to the global trend despite its strong decoupling scenario and encouraging macroeconomic data.
"Post the release of US inflation data, which showcased a MoM increase in inflation, the global market has been pricing in the likelihood of a more aggressive policy response from the Fed," said Vinod Nair, Head of Research at Geojit Financial Services.
On a weekly basis, the Sensex shed 952.35 points or 1.59 per cent, while the Nifty fell 302.50 points or 1.69 per cent. "Markets witnessed a sharp sell-off on the final day of the week and lost closer to 2 per cent. The selling pressure was widespread wherein IT, realty and auto pack were among the top losers," said Ajit Mishra, VP - Research, Religare Broking Ltd.
In the broader market, the BSE midcap gauge tanked 2.85 per cent and the smallcap index slipped 2.38 per cent. All the BSE sectoral indices ended in the negative zone, with realty tumbling 3.53 per cent, followed by IT (3.37 per cent), basic materials (3.05 per cent), teck (3.03 per cent) and auto (2.67 per cent).
World markets buckled under selling pressure on stagflation concerns following negative comments from international agencies like the World Bank and IMF.
Elsewhere in Asia, markets in Seoul, Tokyo, Shanghai and Hong Kong ended lower. European bourses were mostly quoting in the negative territory. The US markets had ended lower on Thursday.
Meanwhile, the international oil benchmark Brent crude climbed 0.32 per cent to USD 91.13 per barrel. The rupee declined by 7 paise to close at 79.78 (provisional) against the US dollar on Friday, tracking a strong dollar in overseas markets.
Foreign institutional investors offloaded shares worth a net Rs 1,270.68 crore in the domestic market on Thursday, according to data available with the BSE.