Stocks fell for the first time in five sessions after market benchmark Sensex crashed 379 points on Tuesday as foreign investors sold heavily and domestic players stayed on the sidelines on concerns over rising bad loans and lack of clarity on fiscal consolidation ahead of the Budget.
Shifting of capital towards state-owned NTPC’s Rs 5,030-crore share sale, traders said, intensified selling pressure in broader markets while global cues turned negative following renewed weakness in crude oil.
The 50-share NSE Nifty also broke below the 7,200-mark with a plunge of 125 points.
“Bears peeled off last three days’ gains influenced by the drop in crude prices. In addition, investors are taking a wait and watch approach ahead of F&O expiry and the Budget,” said Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services.
Asian shares came off from a seven-week high as the oil price rally which had propped up equity markets faltered due to worries of oversupply, brokers said.
Globally, Brent for April dropped 43 cents, or 1.24%, to USD 34.26 a barrel on Tuesday.
Fund managers remained anxious ahead of the Union Budget, which is due on February 29, as they seek clarity on government measures towards fiscal discipline.
The Budget session began today during which opposition parties plan to corner the government on JNU and other issues. The Railway Budget will be presented on Thursday, followed by the Economic Survey the next day, while the Union Budget will be unveiled by Finance Minister Arun Jaitley on Monday.
The gauge lost for much of the session due to profit-booking before ending lower by 378.61 points, or 1.59%, at 23,410.18. Intra-day, it moved between 23,851.51 and 23,361.94.
The markets had opened on Tuesday on an almost flat note, but sell-off accelerated towards the afternoon trade.
The index had risen about 597 points in the past four sessions.
The NSE Nifty eased 1.73% to 7,109.55 after shuttling between 7,241.70 and 7,090.70.
Of the 30-share Sensex pack, 28 lost while Asian Paints and ONGC finished higher.
Stocks of banking and realty bore the brunt. SBI, ICICI Bank, Axis Bank and HDFC Bank fell by up to 3.94%.
NTPC ended 3.04% down despite the institutional investor portion of its 5% stake sale getting oversubscribed within two hours of opening of the trade.
The BSE realty index fell 2.49%, PSU 2.32%, oil and gas 1.87%, metal 1.75% and capital goods 1.70%.
The mid-cap and small-cap indices were no exception, which retreated 1.47% and 1.25%, respectively.
Foreign portfolio investors (FPIs) net sold shares worth Rs 656.93 crore on Monday, provisional data showed.
Hong Kong and Japan led the decline in Asian stocks.
Europe was trading lower as key indices in France and the UK were down by up to 0.69%.