Domestic stock markets tumbled 1 per cent on Wednesday following a muted start, a day after the International Monetary Fund said India is headed for the biggest slump of any major emerging nation. The S&P BSE Sensex index fell 286.01 points – or 0.70 per cent – to 40,339.50 at the weakest level recorded during the session. The broader NSE Nifty 50 benchmark dropped to as low as 11,838.35, down 96.15 points – or 0.81 per cent – from its previous close. A broader global selloff weighed on sentiment.
Lowering its forecast for India a second time in nearly four months, the IMF said the country’s economy will contract 10.3 per cent this year because of the coronavirus pandemic – its biggest contraction since independence. In June, it had predicted a contraction of 4.5 per cent for the economy.
Banking and financial services stocks declined ahead of the Supreme Court’s hearing on interest waivers for loans under moratorium. The Nifty Bank index – which tracks stocks of 12 major lenders in the country – fell as much as 1.09 per cent in morning deals, dragged by SBI, Axis Bank and ICICI Bank.
The outcome of the case could have far-reaching consequences not only for millions of borrowers, but also for banks.
Wiipro shares slumped nearly 7 per cent, a day after the Bengaluru-based IT major reported its earnings and announced a share buyback plan worth Rs 9,500 crore. Its net profit rose 3.2 per cent to Rs 2,466 crore in the July-September period compared to the previous quarter.
Analysts awaited more large cap earnings for cues with IT major Infosys to report its financial results later in the day.
Global market sentiment was dampened after J&J’s COVID-19 vaccine trials were halted because of an unexplained illness in a study participant.
MSCI’s broadest index of Asia Pacific shares outside Japan was last seen trading 0.21 per cent lower. However, the E-Mini S&P 500 futures were up 0.36 per cent, indicating a positive start for US markets on Wednesday.