Indian stocks tumbled like nine pins today, with the benchmark Sensex plunging over 439 points to close at a three-month low of 27,643.11 after a slew of global factors such as weak Chinese export data and Fed rate hike talks unnerved investors.
Besides, a caution ahead of retail inflation numbers - to be released after market hours today - and key quarterly results also influenced trading sentiment in domestic markets. Shares of finance, telecom, banking, realty, utilities and industrials fell sharply due to heavy profit-booking.
The Sensex opened lower and stayed in the negative zone to hit a low of 27,563.84 points before settling 439.23 points, or 1.56 per cent down at 27,643.11, its lowest closing since July 11.
The gauge had gained 21.20 points in the previous session on Monday. Stock Exchanges remained closed on Tuesday and Wednesday for "Dussehra" and "Moharum", respectively.
On similar lines, the National Stock Exchange index Nifty broke below the 8,600-mark to touch the session's low of 8,541.35 and finally settled 135.45 points, or 1.56 per cent, down at 8,573.35.
Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services Ltd, said, "Market was in an intense selling mode after two trading holidays tracking weak global markets which were impacted by poor Chinese trade data, fear of hike in US interest rate and Brexit worries. Domestically investors are also cautious due to the unimpressive August IIP data and awaiting key Q2 results."
Trading, after a two-day holiday, resumed on a subdued note largely in tandem with a weak trend at rest of Asian markets after a below-forecast reading on Chinese data fanned fresh concerns about its economy and Fed Reserve September's meeting minutes boosted the case for higher US interest rates this year, according to brokers.
Market participants' outlook turned bearish on fears that an expected US rate hike could trigger outflows by foreign funds from emerging markets, they added.
The minutes of the September 20-21 meeting, at which the US central bank held rates steady, showed a greater probability of a rate hike in December. Several voting Federal Reserve policymakers judged a rate hike would be warranted "relatively soon" if the US economy continued to strengthen.
Adding to the global woes, China's September exports fell 10 per cent from a year earlier, far worse than expected, while imports unexpectedly shrank 1.9 per cent after picking up in August, suggesting signs of stability in the world's second-largest economy may be short-lived.
Cautious investors also focused on the September-quarter earnings season with Tata Consultancy Services, country's largest software exporter, reporting after market hours today.
Shares of TCS retreated 2.17 per cent, to Rs 2,328.50 but Infosys was up 2.19 per cent at Rs 1,052.05. The company is scheduled to announce its quarterly earnings tomorrow.
"After four consecutive days of net buying, FIIs net sold
Indian equities worth Rs 94.45 crore in yesterday's trade," said Karthikraj Lakshmanan, Senior Fund Manager - Equities, BNP Paribas Mutual Fund.
The market breadth remained negative as 1,304 ended lower, 1,281 closed higher while 191 ruled steady.
The total turnover shrank to Rs 2,058.97 crore from Rs 2,102.26 crore yesterday.