Snapping three sessions of gains, the domestic stock markets closed in the red on Wednesday, dragged by financial stocks such as Indiabulls Housing Finance Ltd and Yes Bank Ltd amid liquidity concerns. The S&P BSE Sensex rose as much as 442.95 points, before declining 382.90 points or 1.09 per cent to end at 34,779.58. The Nifty50 index of the National Stock Exchange (NSE) tanked 131.70 points or 1.24 per cent to settle at 10,453.05, after earlier hitting the crucial 10,700-mark in trade.
Except FMCG and IT, all other sectoral indices led by auto, finance and banking counters, witnessed heavy selling pressure. The overall sentiment was cautious as investors were on a wait-and-watch mode ahead of financial results from Reliance Industries, to be released later in the day, analysts said.
Twenty three out of 30 Sensex stocks finished the session in the red. Prominent losers in the 30-share Sensex pack were Yes Bank (-6.85 per cent), Adani Ports (-5.41 per cent), Maruti Suzuki (-3.79 per cent), Tata Motors (-3.40 per cent), Tata Steel (-3.39 per cent) and SBI (-3.35 per cent). Indiabulls Housing Finance (-13.37 per cent), Bajaj Finance (-6.97 per cent), Yes Bank (-6.39 per cent), Adani Ports (-5.80 per cent) and Bharat Petroleum (-5.51 per cent) were the main losers in the Nifty pack.
The domestic markets have been facing a liquidity crunch amid rising crude prices and depreciating rupee. The recent string of defaults by non-banking financial companies (NBFCs) on debt repayment has compounded worries."Markets were dragged lower by financials as liquidity fears were reignited. NBFC stocks were under pressure. News of one major NBFC having major exposure to a default-rated real estate company spooked the markets", Viral Berawala, CIO, Essel Mutual Fund told NDTV.
In terms of stock-specific action, Dewan Housing Finance Corp closed 12.34 per cent down on the Bombay Stock Exchange (BSE). Reliance Industries closed 1.27 per cent lower while Hero MotoCorp Ltd lost 2.88 per cent.
On the other hand, shares of Infosys Ltd closed 1.16 per cent up on BSE, after the company posted a better-than-expected profit for the September quarter.
Meanwhile, foreign institutional investors (FIIs) sold shares worth Rs 1,165.63 crore, while domestic institutional investors bought shares to worth Rs 1,059.44 crore on Tuesday, as per provisional data available on the NSE. Stock exchanges will remain closed on Thursday on account of 'Dussehra'.
(With inputs from agencies)