Sensex drops over 300 points in early trade; Nifty slips below 15,700

Tech Mahindra was the top loser in the Sensex pack, shedding around 1%, followed by PowerGrid, HDFC, HDFC Bank and Axis Bank

Equity benchmark Sensex tumbled over 300 points in early trade on Thursday, tracking losses in index-heavyweights HDFC twins, ICICI Bank and Reliance Industries amid a largely negative trend in global equities.

The 30-share BSE index was trading 302.80 points or 0.58 per cent lower at 52,199.18 in initial deals. Similarly, the broader NSE Nifty declined 93.70 points or 0.59 per cent to 15,673.85.

Tech Mahindra was the top loser in the Sensex pack, shedding around 1 per cent, followed by PowerGrid, HDFC, HDFC Bank and Axis Bank.

On the other hand, Asian Paints, Sun Pharma, UltraTech Cement and HCL Tech were among the gainers.

In the previous session, Sensex ended 271.07 points or 0.51 per cent lower at 52,501.98, and Nifty retreated from a record and declined 101.70 points or 0.64 per cent to 15,767.55.

Foreign institutional investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 870.29 crore on Wednesday, as per provisional exchange data.

Domestic equities do not look to be good as of now due to weak global cues, said Binod Modi Head-Strategy at Reliance Securities.

While soft bond yields and improving prospects of earnings visibility have resulted in FIIs’ flow to turn favourable in the last couple of days, slight hawkish policy meeting outcome of Federal Open Market Committee (FOMC) may weigh on sentiments in the near term, he noted.

Elsewhere in Asia, bourses in Shanghai and Hong Kong were trading on a positive note, while Seoul and Tokyo were in the red in mid-session deals.

US equities finished lower after the US Federal Reserve indicated it might ease off economic stimulus earlier than previously thought.

The Fed's policymakers forecast that they would raise their benchmark short-term rate, which influences many consumer and business loans, twice by late 2023. They had previously estimated that no rate hike would occur before 2024.

In a statement after its latest policy meeting, the Fed also said it expects the pandemic to have a diminishing effect on the economy as vaccinations increase, thereby allowing for more growth.

International oil benchmark Brent crude was trading 0.54 per cent lower at USD 73.99 per barrel.