Weak cues from the Asian markets, as well as selling pressure in banking, oil and gas, and auto stocks, pulled the key Indian equity indices lower during the mid-afternoon trade session on Wednesday.
Market observers said the Reserve Bank of India's (RBI) move to discontinue the system of issuing Letters of Undertaking (LoUs) by banks for availing trade credits for imports into India with immediate effect eroded investors' risk-taking appetite.
Around 12.22 p.m., the wider Nifty50 of the National Stock Exchange (NSE) declined by 75.80 points or 0.73 per cent to trade at 10,351.05 points.
The barometer 30-scrip Sensitive Index (Sensex) of the BSE, which opened at 33,733.55 points, traded at 33,610.37 points -- down 246.41 points or 0.73 per cent from the previous session's close.
The Sensex has so far touched a high of 33,800.04 points and a low of 33,610.37 points during the intra-day trade.
The BSE market breadth was bearish with 1,470 declines and 953 advances.
"Indian equity markets opened lower as RBI discontinued LoUs, LCs as instruments of trade credit, amid soft opening of Asian markets," Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.
On Tuesday, the indices gave up all gains to close on a flat note due to the sell-off in Tata Consultancy Services' stocks and profit booking in the banking sector scrips.
The Nifty50 inched up 5.45 points or 0.05 per cent to close at 10,426.85 points, while the Sensex closed at 33,856.78 points -- down 61.16 points or 0.18 per cent.
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