Sensex drops 54 pts as bank, power stocks struggle

Sensex drops 54 pts as bank, power stocks struggle

Sensex drops 54 pts as bank, power stocks struggle
 Equities slipped back into the red today after a two-day winning run as the benchmark BSE Sensex declined by 54.14 points to 26,812.78, dragged down by foreign fund outflows and investors booking profit in recent gainers amid caution ahead of crucial British referendum vote.

The rupee, which further weakened by more than 20 paise against the dollar, too kept domestic equities under pressure.

The broader markets however outperformed the Sensex with the small-cap index ending 0.36 per cent higher while mid-cap gained 0.12 per cent.

Power stocks tumbled 0.65 per cent and power sector shares took a hit of 0.70 per cent.

Aviation stocks, which continued their yesterday's rally in early deal following the Centre's decision to allow 100 per cent FDI in civil aviation, succumbed to profit-booking and lost part of the previous session's gains.

Shares of SpiceJet dropped 3.25 per cent, InterGlobe fell 3.09 per cent and Jet Airways lost 1.53 per cent.

In sweeping reforms, the Centre yesterday eased Foreign Direct Investment (FDI) norms in civil aviation, single-brand retail, defence and pharma by permitting more investments under automatic route.

After opening higher, the BSE 30-share Sensex touched a high of 26,925.64 but slipped later to 26,754.60 before ending down by 54.14 points or 0.20 per cent at 26,812.78.

The index had risen 341.46 points in the last two sessions after the government unleashed a new wave of FDI reforms and Brexit worries eased slightly.

NSE Nifty after shuttling between 8,257.25 and 8,202.15 settled 18.60 points or 0.23 per cent lower at 8,219.90.

"Following the sharp rally yesterday, participants decided to take money off the table and book profits. Also, sentiment is now veering towards risk-off, as the date for the Brexit referendum inches closer," said Shreyash Devalkar Fund Manager – Equities, BNP Paribas Mutual Fund.

Overseas, Japan's Nikkei surged 1.28 per cent, Hong Kong's Hang Seng gained 0.77 per cent while Shanghai Composite Index down 0.35 per cent.

Europe was largely mixed as EU referendum jitters returned following huge gains for the region's share prices during the previous session. Key indices in France and Germany moved up by up to 0.13 per cent while the UK's FTSE moved down by 0.29 per cent.