The Sensex and the Nifty50 began the last session of the week in the red amid weakness in the financial, oil & gas and IT pockets.
Indian equity benchmarks began the last session of the week in the red tracking weakness across global markets, as investors remained concerned about the impact of aggressive hikes in COVID-era interest rates on economic growth. Dalal Street entered the July series of derivatives (futures and options) after the Nifty50 finished June with a loss of 389.9 points or 2.4 percent.
Both headline indices fell as much as one percent in early deals. The 30-scrip Sensex shed 527.4 points to hit 52,491.6 and the broader Nifty50 benchmark slid to as low as 15,626.8, down 153.5 points from its previous close.
Losses in financial, oil & gas and IT shares pulled the headline indices lower, though gains in select FMCG counters lent some support.
Reliance, ICICI Bank and Infosys were the biggest contributors to the losses in both main indices.
As many as 33 stocks in the Nifty50 basket succumbed to selling pressure. Titan, ONGC, Hindalco, Bajaj Finserv and JSW Steel were the top laggards among blue-chip stocks.
Dr Reddy's, Tata Motors, ICICI Bank and Coal India were also among the top laggards.
On the other hand, Bharat Petroleum, Larsen & Toubro, Shree Cement, Asian Paints and SBI Life were among the top gainers.
"With the economy showing signs of a gradual recovery despite global headwinds, the prospects for the second half of 2022 appear to be better for the market," said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Oil refiners dropped after the government imposed a cess on domestic crude production and a tax on exports of petroleum products.
Overall market breadth favoured the bears, as 1,378 stocks fell on NSE and 538 rose.
"Stock movements in July will be in anticipation of better-than-expected financial results in banking, IT, telecom and automobile companies. Metals stocks are likely to bottom out absorbing the poor results of the June quarter," Nair added.
Equities in other Asian markets began the day mildly in the red following yet another weak session on Wall Street overnight. MSCI's broadest index of Asia Pacific shares outside Japan was down 0.3 percent at the last count.
Japan's Nikkei 225 was down 0.6 percent and China's Shanghai Composite 0.5 percent. The Hong Kong market was shut for a holiday.
S&P 500 futures were down 0.2 percent.