Sensex closes 335 points lower despite Fed stance
The Sensex stumbled for the second straight day on Thursday, largely in tandem with global markets, as a dovish stance by the US Federal Reserve failed to assuage investor concerns over mounting Covid-19 cases and faltering growth.
The 30-share BSE benchmark frittered away initial gains to close 335.06 points or 0.88 per cent lower at 37,736.07.
On similar lines, the broader NSE Nifty tumbled 100.70 points or 0.90 per cent to end at 11,102.15. IndusInd Bank was the top laggard in the Sensex pack, tumbling 5.62 per cent, followed by HDFC, Axis Bank, PowerGrid, SBI, Bajaj Finserv and Bharti Airtel.
On the other hand, Sun Pharma, Maruti, Infosys and Reliance Industries were among the gainers, climbing as much as 3.44 per cent.
Markets also turned choppy on the expiry of July derivatives and a weak trend in the rupee, traders said.
The US Federal Reserve held rates near zero, as widely expected, and reiterated its commitment to continue bond purchases and other liquidity-boosting measures to prop up the coronavirus-hit economy. However, the dovish stance failed to cheer global equities as participants braced for more corporate results amid a surge in Covid-19 cases in parts of US, Europe and other regions.
On the domestic front, Prime Minister Narendra Modi on Wednesday asked bankers to take a relook at their practices to ensure stable credit growth and not to turn down bankable proposals on apprehensions of prospective bad loans.
During a three-hour long virtual meeting with CEOs of large public and private sector banks along with heads of NBFCs, the Prime Minister assured them that the government is ready to take all steps to support the financial sector.
“Global markets faded as a status quo in policy by the US Fed Reserve failed to offset tepid business outlook and resurgence in virus cases around the world. Indian markets also closed in the negative, in spite of a positive opening.
“Unlock 3.0 failed to enthuse, as earnings results took priority and markets turned volatile in the expiry session. Financials led the losses for the benchmark index,” said Vinod Nair, Head of Research at Geojit Financial Services.
BSE telecom, oil and gas, finance, bankex, utilities and power indices fell up to 2.25 per cent, while healthcare, IT and teck ended higher. Broader BSE mid-cap and small-cap indices fell up to 0.43 per cent.
Bourses in Shanghai, Hong Kong and Tokyo ended in the red, while Seoul settled on a positive note.
Stock exchanges in Europe were trading with losses in early deals.
Global oil benchmark Brent crude was trading 1.27 per cent lower at USD 43.53 per barrel.
In the forex market, the rupee fell 4 paise to close at 74.84 against the US dollar.
Covid-19 cases in India crossed the 50,000 mark in a single day for the first time, pushing the virus tally to 15,83,792, while the recoveries went past 10 lakh on Thursday, according to Health Ministry data.
The death toll climbed to 34,968 with 775 people succumbing to the disease in a day. Globally, the number of Covid-9 cases has crossed 1.68 crore, with more than 6.61 lakh fatalities.