Mumbai, Aug 2 (IANS) Broadly negative global cues along with disappointment over the RBI's lending rate hike and a weak rupee dragged the key Indian equity indices -- NSE Nifty50 and S&P BSE Sensex -- deep into the red on Thursday.
According to market observers, profit booking and heavy selling pressure was witnessed in the interest sensitive stocks like banking, automobile and capital goods which plunged a day after the RBI hiked its key lending rates by 25 basis points.
Resurgent trade-war like conditions also eroded the global investor sentiment. US President Donald Trump has escalated his trade war with China, ordering his administration to consider more than doubling proposed tariffs on $200 billion worth of Chinese goods to 25 per cent from 10 per cent, as talks between Washington and Beijing remain at a standstill.
Index-wise, the wider Nifty50 on the National Stock Exchange provisionally closed at 11,244.70 points, lower by 101.50 points or 0.89 per cent from its previous level of 11,346.20 points.
The 30-scrip BSE Sensex, which had opened at 37,529.69 points, closed at 37,165.16 (3.30 p.m.) -- lower by 356.46 points or 0.95 per cent from its previous close of 37,521.62 points.
On an intra-day basis, it touched a high of 37,529.69 points and a low of 37,128.99 points.
In the broader markets, the S&P BSE mid-cap rose by 0.09 per cent and the S&P small-cap ended 0.07 per cent higher from its previous close. The BSE market breadth was largely even with 1,328 advances against 1,341 declines.
"Markets corrected sharply on Thursday after a weak opening. The correction came on the back of a fall in interest rate sensitive stocks after the Reserve Bank of India (RBI) raised its key policy rate on Wednesday," said Deepak Jasani, Head of Retail Research at HDFC Securities.
Escalating US-China trade spat also impacted the market sentiments, he added.
Major Asian markets closed on a sharply negative note and European indices like FTSE 100, DAX and CAC 40 are trading deep in the red, Jasani told IANS.
On the currency front, the rupee closed at 68.71, weakened by 27 paise from the previous close of 68.44 per dollar. It got adversely impacted by US Fed's decision to maintain its lending rates.
Investment-wise, provisional data with exchanges showed that foreign institutional investors sold scrip worth Rs 639.87 crore and the domestic institutional investors sold stocks worth Rs 340.30 crore.
Sector-wise, the S&P BSE Healthcare rose by 148.19 points, the consumer durables index rose by 49.75 points and the metal index was up 34.02 points.
On the contrary, the S&P BSE auto index lost the most, by 305.84 points, followed by the banking index, which fell by 258.33 points and the capital goods index, down 99.41 points.
The major gainers on the Sensex were Power Grid, up 2.25 per cent at Rs 188.20; Coal India, up 1.07 per cent at Rs 273.20; Hindustan Unilever, up 0.92 per cent at Rs 1,749; IndusInd Bank, up 0.91 per cent at Rs 2,021.55; Wipro, up 0.76 per cent from Rs 279.05 per share.
The major losers were Bharti Airtel, down 2.79 per cent at Rs 372.95; Kotak Mahindra Bank, down 2.54 per cent at Rs 1,281; Maruti Suzuki, up 1.97 per cent at Rs 9,156.70; Reliance Industries, down 1.91 per cent at Rs 1,168.35; and HDFC, down 1.90 per cent at Rs 1,932.65 per share.
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