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Benchmark indices ended over 1% lower on Wednesday as investors pressed sales after escalating violence in Iraq's main oil refinery raised concerns that high oil prices could escalate inflationary pressures.
The 30-share Sensex ended down 275 points or 1.1% at 25,246 and the 50-share Nifty ended down 73 points or 1% at 7,558.
The Indian rupee was trading lower at Rs 60.37 to the US dollar compared to the previous close of Rs 60.03 on the back of higher demand for dollar following the uptick in crude oil prices amid conflict in Iraq.
Asian markets ended lower with the exception of Nikkei which gained after the yen weakend against the US dollar. Japan's benchmark Nikkei ended up 0.9%, while Singapore's Straits Times ended up 0.1%. Further, China's Shanghai Composite ended down 0.5% and Hong Kong's Hang Seng ended down 0.1%.
European markets were trading with marginal gains as investors remained cautious ahead of the two-day US Fed policy meet which ends later today. The CAC, DAX and FTSE were up 0.1-0.3% each.
Reliance Industries ended down 2.5% contributing the most to the Sensex decline.
FMCG majors ended lower amid concerns that rising inflation could hurt consumer spends and impact volume growth. ITC and Hindustan Unilever ended down 1-2% each.
IT majors ended lower despite a weakening rupee as investors booked profits after recent gains. Wipro, Infosys and TCS ended down 0.8-2.5% each.
Among the rate-sensitive shares, financials were also among the top losers with HDFC Bank, ICICI Bank and HDFC ending 0.8-2.2% lower.
In the capital goods space BHEL lost 3.2% and L&T ended 0.9% lower.
Other Sensex losers include Sun Pharma and Tata Motors.
Cipla has gained nearly 3% to end at Rs 425 after the pharmaceutical company said it has acquired 60% stake in a new company in Sri Lanka for $14 million (nearly Rs 85 crore) to market its product in the country.
Hindalco, Gail, Dr Reddy's Labs, Maruti Suzuki were among the Sensex gainers.
Oil marketing companies BPCL, HPCL and IOC which import crude oil ended down 2-5% on concerns that higher crude oil prices could hurt margins.
Among other shares, Punj Lloyd has soared 16% to end at Rs 55.85, after hitting 52-week high of Rs 57.70 on BSE, on back of heavy volumes. In past three trading sessions, the stock has rallied 23% compared to 0.62% rise in benchmark S&P BSE Sensex on buzz that the company is selling its stake in Gurgaon-based multi speciality Medanta Medicity Hospitals to cut its debt.
Zee Entertainment Enterprises ended up 3.3% at Rs 277 in an otherwise weak market after multiple block deals were executed on the counter on NSE and BSE. About 7.88 million shares representing 0.82% of total equity of Zee Entertainment changed hands in three block deals on NSE and BSE.
TVS Motor Company has surged 4.9% to end at Rs 141.70, also its record high on BSE, on the back of heavy volumes on the counter. The average monthly delivery volume of TVS Motor Company rose to 49% in June, with almost every one out of two shares traded in to delivery. It was 35% in May and 32% in January this year.
Kotak Mahindra Bank ended up 2% at Rs 958 after hitting a 52-week high of Rs 972, after the private sector lender proposes to increase the ceiling limit of overseas investment to 40%. Kotak Mahindra Bank in its notice to shareholders for the upcoming annual general meeting (AGM) on July 16 has sought members’ approval to pass a resolution to this effect.
Ricoh India ended in lower circuit for second day in a row, down 20% at Rs 138 on BSE, after the company said its delisting offer has failed.
Shares in Mahanagar Telephone Nigam Limited (MTNL) surged 8% to end at Rs 34.35, extending its previous day's 8 rally, on reports that the government will initiate steps to revive ailing state-owned telecom company.
In the broader market, the BSE Mid-cap index ended down 1% and BSE Small-cap index ended down 0.4%.
Market breadth was negative with 1,639 losers and 1,392 gainers on the BSE.
