Benchmark indices Sensex and Nifty remained under pressure for the fifth consecutive session on Thursday as investors offloaded metal, banking, and finance stocks amidst a bleak global market trend.
The decline was further fueled by heavy foreign fund outflows following a hike in securities transaction tax and short-term capital gains tax, contributing to a negative market sentiment.
However, strong buying in oil, energy, and auto shares provided some relief to the indices, preventing a more significant decline.
The 30-share BSE Sensex, after a sharp intra-day fall, managed to recover some losses, closing 109.08 points or 0.14% lower at 80,039.80. During the day, it had plummeted 671 points or 0.83% to 79,477.83, before a rally in Tata Motors and Larsen & Toubro helped restrict its fall. Tata Motors jumped nearly 6%, while Larsen & Toubro ended almost 3% higher following a 12% rise in consolidated profit after tax (PAT) in the June quarter.
On the NSE, the Nifty dipped 7.40 points or 0.03% to 24,406.10. Intra-day, it tumbled 202.7 points or 0.83% to 24,210.80.
Over the last five days, the BSE benchmark has tumbled 1,303.66 points or 1.60%, while the Nifty declined 394.75 points or 1.59%.
"Overnight slump in US equities caused a major dip in domestic markets in early trade due to heavy profit-taking in banking, IT, metals, and realty stocks," said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd. "However, markets recouped most of their 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."
From the Sensex pack, Axis Bank declined over 5% following its underwhelming June quarter earnings. Other laggards included Nestle, Titan, ICICI Bank, Tata Steel, IndusInd Bank, ITC, JSW Steel, and State Bank of India. Conversely, Sun Pharma, Kotak Mahindra Bank, Bajaj Finance, and Power Grid ended in positive territory.
"Global stocks tumbled on Thursday after a tech-fuelled sell-off on Wall Street last night," said Deepak Jasani, Head of Retail Research at HDFC Securities. "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."
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