Markets continued to decline for the fifth day on Thursday with BSE Sensex losing 0.72% or 149.05 points at 20,498.25, while NSE Nifty was down 0.76% or 46.55 points at 6073.70. The selling was triggered by US Federal Reserve's decision to further scale back its stimulus package.
Among sectoral indices, BSE Realty Index was down 2.60%, BSE Metal Index was down 2.52% and BSE Bankex was down 2.67%. Among individual stocks, State Bank of India (SBI) (-3.56%), Hero MotoCorp (-3.43%) and Sesa Sterlite (-3.38%) were the biggest losers on the Sensex. Metal stocks were under pressure with fall China's PMI Index stirring demand concerns.
Meanwhile, most Asian indices were in the red. Shanghai Composite (-0.82%), Hang Seng (-0.48%) and Straits Times (-0.68%) traded lower.
FIIs have net bought about $107 million worth of Indian shares in January but experts suggest the pace of buying is slowing down. Industry watchers believe that the recent cut in quantitative easing, might impact FII flows to emerging markets such as India.
On Wednesday, the Dow Jones Industrial Average had ended down 1.19%, while Nasdaq Composite was down 1.14%.
Sahaj Agrawal, Deputy Vice President- Derivatives Research, Kotak Securities:
Markets witnessed significant selling pressure throughout the January series. Tightening in the monetary policy along with reduction in QE by the FED led to further selling in domestic markets. On a monthly basis Nifty lost nearly 4 percent. Banking stocks lost ground as the Bank Index lost nearly 10 percent; similar losses were seen in the midcap index. IT stocks continued to gain. Strong rollover into the Feb series indicates possibility of continued selling pressure for the early part of the series.
Outlook: We expect strong support around 5,900 levels. We continue to remain positive on the FMCG, IT and Pharma space and advice stock specific accumulation in the high beta space.
US Fed taper pulls down Sensex by 149 pts to two-month low
(PTI) BSE Sensex today slipped 149 points to a two-month low on fears of capital outflows from emerging markets after the US Federal Reserve further cut its stimulus, extending the decline from a record close for the fifth day.
Selling due to expiry of monthly equity derivatives amid a weak global trend also affected the sentiment, traders said.