The Indian equity benchmarks erased early gains on Thursday ahead of monthly expiry of May futures and option contracts dragged by losses in Reliance Industries, ITC, Larsen & Toubro, Bajaj Finance, Asian Paints and Hindustan Unilever. The Sensex fell as much as 678 points from the day's highest level and Nifty 50 index broke below its important psychological level of 16,000.
As of 12:00 pm, the Sensex was down 280 points at 53,469 and Nifty 50 index declined 94 points to 15,931.
"Nifty has an immediate resistance at 16100. If nifty closes above that, further upside can be expected towards 16170-16300 mark. On the flip side 15950-15850 will act as strong support levels. It’s a stock specific market trade calls with strict stop loss," brokerage firm Nirmal Bang said in a report.
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Asian stock markets were mixed Thursday after notes from the Federal Reserve’s latest meeting confirmed expectations for more interest rate hikes but contained no surprises to rattle investors.
Benchmarks in Hong Kong and Sydney declined while Tokyo, Shanghai and Seoul were higher. Oil prices also advanced.
Investors are uneasy over the impact of interest rate hikes in the United States and other Western economies to cool surging inflation. Wednesday’s Fed release showed board members support 0.5-percentage-point hikes at their next two meetings. That will weigh on economic activity but already was factored into stock prices.
There were no “hawkish or dovish surprises” or mention of a bigger increase, said Anderson Alves of ActivTrades in a report.
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Back home, nine of 15 sector gauges compiled by the National Stock Exchange were trading lower led by the Nifty Oil & Gas index's 1.75 per cent decline. Nifty Consumer Durables, Realty, Media, FMCG and Auto indices also fell between 1-1.7 per cent.
On the other hand, select banking, IT and financial services shares were witnessing buying interest.
Mid- and small-cap shares were also facing selling pressure as Nifty Midcap 100 index declined 0.82 per cent and Nifty Smallcap 100 index fell 1.1 per cent.
Adani Ports was top Nifty loser, the stock fell 4.13 per cent to Rs 678. UPL, Bharat Petroleum, Asia Paints, Apollo Hospitals, Bajaj Finance, Divi's Labs, ONGC, Bajaj Finserv, Larsen & Toubro and Reliance Industries also fell between 2-4 per cent.
On the flipside, HDFC Bank, JSW Steel, HDFC, Axis Bank, Nestle India, Tata Steel, Tech Mahindra, Wipro and ICICI Bank were among the gainers.
The overall market breadth was extremely negative as 2,328 shares were declining while 828 were advancing on the BSE.
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