Amid concerns over new rules and heightened fees of the US H-1B visa, foreign fund outflows continued, dragging down Indian stock markets further for the fourth day in a row.
The 30-share BSE Sensex dropped 386.47 points or 0.47 per cent to end at 81,715.63. During the day, it tanked 494.26 points or 0.60 per cent to 81,607.84.
The 50-share NSE Nifty declined 112.60 points or 0.45 per cent to 25,056.90.
Among Sensex firms, Tata Motors, Bharat Electronics, UltraTech Cement, Tech Mahindra, Mahindra & Mahindra, ICICI Bank, Tata Consultancy Services and Axis Bank were the major laggards.
However, Power Grid, Hindustan Unilever, NTPC and HCL Tech were among the gainers.
Foreign Institutional Investors (FIIs) offloaded equities worth ₹3,551.19 crore on Tuesday, according to exchange data.
Also Read: Stock markets on the hook on FII outflow, H-1B concerns
"Profit-booking has been observed in Indian markets post-GST reforms, as investors recalibrate valuations and Q2 earnings expectations. IT stocks underperformed due to H-1B fee hikes, while US trade rhetoric amid ongoing trade negotiations and weak global cues are prompting cautious investor sentiment," said Vinod Nair, Head of Research, Geojit Investments Limited.
India’s relatively high valuations, coupled with moderation in earnings growth, continue to lead FIIs to trim their positions, Nair added.
Meanwhile, IT stocks fell for the third day in a row on Wednesday as the steep hike in US H-1B visa fees continues to dent investor sentiment.
Mastek Ltd shares fell by 3.42 per cent, Infobeans Technologies dropped 3.41 per cent, Wipro by 2.06 per cent, Tech Mahindra by 1.30 per cent, Tata Consultancy Services by 0.86 per cent and Infosys by 0.24 per cent on the BSE.
The BSE IT index dipped 0.69 per cent to 34,529.91.
"IT stocks underperformed due to H-1B fee hikes," agreed Nair.
"Market sentiments were weighed down by continued concerns over US visa policy changes and persistent FII selling," said Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd.
In Asian markets, South Korea's Kospi ended lower while Japan's Nikkei 225 index, Shanghai's SSE Composite index and Hong Kong's Hang Seng settled in positive territory.
Equity markets in Europe were trading lower while US markets also ended in negative territory on Tuesday.
Global oil benchmark Brent crude climbed 0.44 per cent to USD 67.93 a barrel.
Meanwhile, the rupee recovered from early lows to settle almost flat at 88.72 against the US dollar. The local unit slumped to 88.80 in early trade but recovered later to hit a day’s high of 88.67 against the US dollar.
On Tuesday, the Sensex ended lower by 57.87 points or 0.07 per cent at 82,102.10. The Nifty dipped 32.85 points or 0.13 per cent to 25,169.50.
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