Indian stocks experienced a significant downturn on Thursday, reflecting a persistent deflationary trend in China and uncertainty stirred by U.S. President-elect Donald Trump's proposed tariff measures.
Investor sentiment was further dampened by anxieties regarding possible slowdowns in corporate earnings growth and the Federal Reserve's strict approach towards interest rate adjustments.
The benchmark S&P BSE Sensex declined by 528.28 points, equivalent to a 0.68 percent drop, reaching a level of 77,620.21. This marked a second consecutive day of losses, as the U.S. dollar remained strong and U.S. Treasury yields saw an uptick amid concerns about inflationary effects arising from Trump's policies.
There is an expectation that the fiscal and tariff measures proposed by President-elect Trump could stimulate U.S. economic growth while simultaneously contributing to inflationary pressures.
Meanwhile, the broader NSE Nifty index fell by 162.45 points, or 0.69 percent, closing at 23,526.50. The BSE mid-cap and small-cap indices also recorded declines, dropping by 1 percent and 1.2 percent respectively.
The market displayed a negative breadth on the BSE, with 2,732 stocks declining, 1,225 advancing, and 110 remaining unchanged.
Notable declines were observed in Tata Steel, Coal India, BPCL, Shriram Finance, and ONGC, with losses ranging from 2-3 percent. TCS saw a 1.6 percent decrease ahead of its earnings report.
Conversely, FMCG stocks witnessed gains attributed to defensive buying, as Britannia Industries, Hindustan Unilever, and Nestle increased by 1-2 percent.
The auto sector also experienced a boost, with Mahindra & Mahindra rising by 1.5 percent and Bajaj Auto surging by 2.1 percent.
