Markets extend losses for 5th session; metal, bank stocks major drag

MUMBAI: Equity market benchmark indices Sensex and Nifty stayed on the back foot for the fifth straight session on Thursday as investors offloaded metal, banking and finance stocks amid a lacklustre trend in global markets.

Heavy foreign fund outflows after a hike in securities transaction tax and short-term capital gains tax also impacted markets' sentiment negatively, traders said.

However, strong buying in oil & stocks, energy and auto shares helped the indices offset some losses, they added.

After a sharp fall in intra-day trade, the 30-share BSE Sensex managed to recover some of the lost ground to settle 109.08 points or 0.14 per cent lower at 80,039.80, as a sharp rally in Tata Motors and Larsen & Toubro restricted its fall. During the day, it tanked 671 points or 0.83 per cent to 79,477.83.

Shares of Larsen & Toubro ended nearly 3 per cent higher after the company posted a 12 per cent rise in consolidated profit after tax (PAT) in the June quarter.

Tata Motors jumped nearly 6 per cent.

The NSE Nifty dipped 7.40 points or 0.03 per cent to 24,406.10. Intra-day, it tumbled 202.7 points or 0.83 per cent to 24,210.80.

In five days, the BSE benchmark has tumbled 1,303.66 points or 1.60 per cent, while the Nifty declined 394.75 points or 1.59 per cent.

"Overnight slump in US equities caused a major slump in domestic markets in early trade due to heavy profit-taking in banking, IT, metals and realty stocks.

"However, markets recouped most of its losses towards the end, with Sensex managing to close above the crucial 80k-mark amid buying in oil & gas and automobile stocks, indicating that investors are willing to bet on good fundamental sectoral stocks despite rising concerns of the stretched valuations of the Indian markets," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.

From the Sensex pack, Axis Bank declined over 5 per cent after the company's June quarter earnings failed to cheer investors.

Nestle, Titan, ICICI Bank, Tata Steel, IndusInd Bank, ITC, JSW Steel and State Bank of India were the other laggards.

Sun Pharma, Kotak Mahindra Bank, Bajaj Finance and Power Grid also ended in the positive territory.

"After a volatile session, the Indian market concluded on a flat note, influenced by lower-than-expected earnings growth from major banks. Global indices also reacted pessimistically due to the disappointing results from top US tech companies.

"However, the government's commitment to improving consumption and bridging the gap for energy transition in the budget buoyed sectoral sentiments," said Vinod Nair, Head of Research, Geojit Financial Services.

In the broader market, the BSE midcap gauge declined 0.22 per cent, and smallcap index dipped 0.14 per cent.

Among the indices, metal lost 1.19 per cent, bankex (1.10 per cent), realty (0.80 per cent), telecommunication (0.65 per cent) and financial services (0.60 per cent).

On the other hand, energy, healthcare, industrials, utilities, auto and oil & gas were among the gainers.

"Global stocks tumbled on Thursday after a tech-fuelled sell-off on Wall Street last night. A slew of disappointing results caused traders to panic that the artificial-intelligence frenzy that has powered the bull market this year may have been overdone," Deepak Jasani, Head of Retail Research, HDFC Securities, said.

In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong settled lower.

European markets were trading in the negative territory in the mid-session deals. US markets ended significantly lower on Wednesday.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 5,130.90 crore on Wednesday, according to exchange data.

Global oil benchmark Brent crude declined 1.73 per cent to USD 80.31 a barrel.

The BSE benchmark declined 280.16 points or 0.35 per cent to settle at 80,148.88 on Wednesday. The NSE Nifty dropped 65.55 points or 0.27 per cent to 24,413.50.