Benchmark share indices ended over 2% lower at fresh 13-month lows, amid weak global cues, ahead of the US jobs data that could raise the prospects of a rate hike by the US Federal Reserve rekindled fears of further foreign fund outflows.
The 30-share Sensex ended down 563 points at 25,202 and the 50-share Nifty closed 168 points lower at 7,655.
The broader markets also witnessed selling pressure with both the BSE Mid-cap and Small-cap indices ended down 1.9-2.5% each. Market breadth ended weak with 2,115 losers and 577 gainers on the BSE. "
The overhang of China continues to remain on Indian markets. With domestic institutional buying remaining the major support further downside cannot be ruled out as the the situation in China and rate hike worries by the US Fed post the jobs data later today.
Portfolio positioning needs to be defensive as India's outperformance versus emerging market peers makes its susceptible for future correction.
Further, India's weak GDP's print illustrates the weak macro condition on one hand and India's inability to thrive independent of global trends," said Tirthankar Patnaik, India Strategist, Mizuho Bank.
The Indian rupee was trading 25 paise lower at 66.49 to the US dollar on concerns of foreign fund outflows and weakness in domestic equities.
Foreign institutional investors were net sellers in equities to the tune of Rs 394 crore, as per provisional stock exchange data.
Asian stocks also witnessed selling pressure with shares in Japan losing the most in the region.
The benchmark Nikkei ended 2.2% lower while Singapore's Straits Times closed 1.4% down.
Hong Kong's Hang Seng ended down 0.5%. Stock exchanges in China were closed for trading. European shares extended losses ahead of US jobs data later today which could be the decider on US Federal Reserve's stance on key interest rates. The CAC-40, DAX and FTSE-100 were down 1.7-1.9% each.
Sectors and stocks
All sectoral indices ended in the red with BSE Bankex, Power and Realty indices being the top losers down 2-3% each followed by others.
The BSE Bankex and NSE Bank Nifty ended down over 2.5% each. In the financials segment, HDFC, ICICI Bank, HDFC Bank, Axis Bank and SBI ended down 2.4-3.5% each.
According to CRISIL Rating, the draft guidelines by the Reserve Bank of India on computation of base rate, if implemented in its current form, will significantly impact profitability of banks.
IT exporters such as Infosys, Wipro and TCS ended down over 2% on profit taking ahead of US jobs data.
Pharma shares also witnessed selling pressure despite a weak rupee. Sun Pharma and Dr Reddy's Labs and Cipla ended down over 3% each. Further, Lupin trimmed early gains to end flat with negative bias.
The company announced that its overseas subsidiary Lupin Pharmaceuticals, Inc., has launched first ever generic Duloxetine DR (delayed-release) capsule in 40mg dosage strength. Other Sensex losers include, ITC, Reliance Industries, Tata Motors and L&T among others.
However, Bharti Airtel and Coal India were the sole gainers in the Sensex. Among other shares, Jyothy Laboratories ended nearly 5% higher in an otherwise weak market amid reports that German consumer products company Henkel AG plans to buy a 26% stake in local fabric whitener and detergent maker.
Shares of Amtek Auto has dipped 9% to Rs 28.80, extending its Thursday’s 35% fall on the National Stock Exchange (NSE) after foreign institutional investors (FIIs) sold nearly four million equity shares of the company through open market.
Avanti Feeds gained 1% after the company scheduled a board meeting on August 12, 2015 to consider a stock split proposal.