Bank shares were the top losers along with index heavyweight RIL
Benchmark share indices registered their highest single-day loss in percentage terms since June 24, the day of the Brexit verdict, on profit booking after sharp gains recently outpaced valuations.
The S&P BSE Sensex ended down 310 points or 1.1% at 27,775 and the Nifty50 dropped 103 points or 1.2% at 8,575. On June 24, 2016 post the Brexit vote the S&P BSE Sensex had lost 2.2% or 605 points while the Nifty50 index plunged 2.2% or 182 points. The BSE Midcap and Smallcap indices ended down 1.2% each. Market breadth was weak with 1899 declines and 829 advances on the BSE.
"The market nosedived as investors believe that the recent rally has outpaced the market valuation, which is trading at a premium to last 3 years average. Bond yield & Gold prices have seen momentum today as liquidity is shifting towards safe haven assets," said Vinod Nair, Head of Fundamental Research, Geojit BNP Paribas Financial Services.
Foreign portfolio investors were net buyers in equities worth Rs 144.15 crore on Tuesday as per provisional stock exchange data. Foreign funds have been aggressive buyers in Indian equities with net purchases of over $2 billion.
Bank shares were among the top losers after the RBI at its policy maintained status quo on key policy rates. ICICI Bank, HDFC Bank, SBI and Axis Bank ended down 1%-2.6% each.
Mortgage lender HDFC ended marginally lower. The company's life insurance arm HDFC Life and Max Life Insurance announced a swap ratio for their merger.
Lupin extended losses and ended down by over 4% despite robust first quarter earnings after operational performance was lower-than-expected. India's third-largest drugmaker reported a 68% rise in first-quarter profit, beating analysts' expectations.
Investment banks have made suggestions to the Aditya Birla Group to hive off its financial services and insurance businesses from BSE-listed Aditya Birla Nuvo to invite new investments in the two businesses. Shares of Aditya Birla Nuvo and Grasim slipped between 4%-6.6% while AB Money surged over 12%.
Mahindra & Mahindra ended down 2.6%. Standalone net profit for the June quarter was up 12% at Rs 955 crore compared with Rs 850 crore in the same quarter last fiscal.
Adani Ports and Special Economic Zone gained nearly 8% after posting a 31 per cent growth in its net profit in Q1 of FY 2017 at Rs 835.71 crore, as against Rs 638.93 crore for the corresponding period last year.
Among other shares, Jubilant Life Sciences surged 7.4% after the pharmaceutical company reported 350 basis points Ebitda (earnings before interest, taxes, depreciation and amortisation) margin expansion at 26.2% for the quarter ended June 2016 (Q1FY17), up from 22.7% in the same quarter last year.
Motherson Sumi Systems (MSSL) dropped over 6% on profit booking after the company reported 13% year-on-year (YoY) jump in consolidated net profit of Rs 303 crore for the quarter ended June 30, 2016 (Q1FY17).
Tata Chemicals jumped nearly 9% after the company announced sale of its urea business to Yara for Rs 2,670 crore.
Illustration: Uttam Ghosh/Rediff.com