Sensex, Nifty Fall 1% As Markets Halt 3-Day Winning Streak

Domestic share markets fell more than 1 per cent on Thursday amid a selloff in banking and financial services sectors, amid weakness in global stocks after the Federal Reserve warned the US economy faced a highly uncertain path to recovery from the coronavirus pandemic-induced downturn. The S&P BSE Sensex index shed as many as 402.13 points during the session to hit 38,212.66 on the downside, and the broader NSE Nifty 50 benchmark skidded to as low as 11,294.15, down 1.02 per cent from its previous close.

The Sensex ended 394.40 points - or 1.02 per cent - lower at 38,220.39 and the Nifty settled at 11,312.20, down 96.20 points - or 0.84 per cent - from its previous close.

Tata Motors, HDFC, Axis Bank, ICICI Bank and Wipro, settling with losses of 1.88-2.64 per cent for the day, were the worst hit among the 35 laggards in the 50-scrip index. On the other hand, NTPC, ONGC, PowerGrid and Coal India, ending between 2.37 per cent and 6.87 per cent, were among the top gainers.

Reliance Industries (closing 1.73 per cent lower), HDFC (2.35 per cent) and ICICI Bank (1.72 per cent) were the biggest drags on Sensex.

Both indices put an end to a three-day winning run, amid worries of a prolonged economic slowdown on account of increasing COVID-19 cases.

Domestic coronavirus cases rose, with a record daily jump of 69,652 infections on Thursday morning, taking the total infections to 2.84 million and deaths to 53,866, data from the federal health ministry showed.

The Nifty Bank index - comprising stocks of 12 major lenders in the country including SBI, HDFC Bank and Kotak Mahindra Bank - ended 1.29 per cent lower, having slumped 1.79 per cent at the lowest level recorded in intraday trade.

Meanwhile, the rupee returned to the 75 mark against the US dollar after more than two weeks, ending at 75.03 for the day.

Global shares came under pressure after minutes of the US central bank's latest meeting showed policymakers remained doubtful about a swift rebound in recovery in the world's largest economy.

The readout on Fed discussions provides hints to further action that the US central bank could take in September. No change in interest rate policy is expected until the end of 2021.

MSCI's broadest index of Asia Pacific shares outside Japan dropped 1.64 per cent, whereas Japan's Nikkei 225 benchmark fell 1.00 per cent.

European shares started Thursday's session sharply lower, with the United Kingdom's FTSE index last seen down 1.16 per cent in early trade. While France's CAC index traded 1.05 per cent lower at the time, Germany's DAX gauge was down 0.91 per cent.

The E-Mini S&P 500 futures were down 0.19 per cent, indicating a sluggish start for US markets on Thursday.

Global market sentiment had been bullish up until the Federal Reserve's comments, with the S&P 500 and the Nasdaq hitting all-time highs driven largely by Apple Inc, whose market value touched the $2-trillion milestone.