Experts say foreign investor sentiment was bolstered by the US Federal Reserve's decision to go slow with interest rate hikes and hopes of political stability.
The broader NSE Nifty sank 252.55 points, or 2.14 per cent, to 11,558.60.
The RBI had opened special swaps windows to attract deposits from non-resident Indians and allow oil-marketing companies to source dollars.
Top gainers in the Sensex pack included Tata Steel, Kotak Bank, NTPC, HDFC twins, PowerGrid and ONGC, rising up to 4.60 per cent.
Rate-sensitive sectors like banks, auto and realty witnessed strong buying demand in trades today
At the outset, decide whether you want to be a trader or an investor, suggest Sarbajeet K Sen and Sanjay Kumar Singh.
The markets are showing no signs of stability as the economic impact of the coronavirus outbreak is likely to be significant for many major economies.
Ukraine fears weighed on sentiment, with Russia rejecting a peace proposal amidst civil war-like situation in the former Soviet union republic.
Sensex under pressure as Yellen signals rate hike; banking stock slip.
Emerging economies should also be mindful of growth.
US Federal Reserve Chairman Ben S Bernanke held talks with RBI Governor Duvvuri Subbarao in Mumbai.
The tiny Central American nation of El Salvador has embarked on an interesting experiment by recognising bitcoin as legal tender. This is proving painful for many of its citizens but it's a useful "pilot" project for larger economies that are contemplating the peculiarities of this new asset class. El Salvador has a population of 6.5 million and GDP of about $27 billion.
The US Federal Reserve on Wednesday night hiked interest rates by 0.25%.
The report did not specify the impact the rate hike will have on India.
The comment was in response to a June 19 Reuters story citing sources with knowledge of the matter as saying that India planned to clear some oil payments to Iran through the United Arab Emirates central bank.
Moody's has a 'Baa3' rating for India, with a positive outlook.
Investing in the US market provides Indian investors a hedge against the rupee's long-term tendency to depreciate against the dollar.
The 30-share Sensex dropped 68.16 points at 18,664.88 and the 50-share Nifty fell 23.15 points at 5,519.10 levels.
Strong dollar will impact financial system in India.
Thus far in FY21, BSE, NSE have rallied 70 per cent and 71 per cent, respectively.
However, dollar's rise against other currencies overseas capped the gains
'Three external members of the first MPC are respected researchers with excellent academic background, but there is no harm in considering academicians with diverse backgrounds such as finance and labour along with economists for this body,' recommends Tamal Bandyopadhyay.
The US Federal Reserve has announced to maintain its bond purchase tapering programme.
Investors who cannot manage an asset-allocated portfolio or rebalance regularly, or do not have an advisor, may opt for these funds, but only after a detailed study of their strategy, suggests Sanjay Kumar Singh.
The RBI is expected to build reserves so the source of primary liquidity creation is backed by forex reserves.
Samvat 2071: Sensex drops most in 4 years
Foreign institutional investors added $20.10 billion in equities while they pulled out $7.97 billion from the debt market, resulting in total net flows of $12.13 billion.
The BSE mid-cap and small-cap indices ended flat against Sensex's 0.4% up-move.
ICICI Bank, HDFC Bank, IndusInd Bank down between 0.2%-1.4% each.
The 30-share Sensex lost 22 points to close at 27,090 and the 50-share Nifty gained 7 points to end at 8,121.
Crucially, the US central bank softened the blow by making its forward guidance even more dovish.
On speculative front as well, non-commercials have decreased bullish bets on COMEX silver futures and options to a three-month low.
The 30-share BSE Sensex shed 0.9% or 186 points at 20,536 while the 50-unit NSE Nifty was off 1% or 61 points at 6,091.
Macro-economic data from China and minutes of the US Federal Reserve's last meeting caused the turmoil as stocks tumbled around the globe.
The markets will also keenly eye the HSBC manufacturing and services data.
With a global selloff over concerns of the US Federal Reserve's bond-buying tapering impacting the currencies of several emerging markets, the rupee has been the worst performer since Thursday.
Top gainers in the Sensex pack included Vedanta, Coal India, ICICI Bank, PowerGrid, HCL Tech and Bajaj Finance, rising up to 2.65 per cent.
Experts recommend buying gold as the fundamentals supporting a rally have not changed.
Second quarter earnings of companies, starting with the Infosys results, export-import numbers and industrial production data, could keep markets volatile in the week ahead.
The Financial Stability and Development Council members include heads of regulatory bodies like RBI, Sebi and Insurance Regulatory Development Authority.
© 2026 Rediff.com - Investor Information - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances