Indian equity benchmarks suffered sharp losses on Thursday, falling for the third day in a row, amid weakness across global markets as investors worried over surging inflation. Losses in financial, IT and consumer stocks pulled the main indices lower, though gains in metal shares lent some support.
The 30-scrip index shed 433.1 points or 0.7 percent to end at 59,919.7 and the broader Nifty50 benchmark settled at 17,873.6, down 143.6 points or 0.8 percent from its previous close.
SBI, ONGC, SBI Life, Bajaj Finserv, Tech Mahindra, Sun Pharma, Bajaj Finance and Eicher Motors -- closing between 1.8 percent and 2.8 percent lower -- were the worst hit among the 41 laggards in the Nifty50 universe.
Titan, Hindalco, JSW Steel, TCS and Mahindra & Mahindra, up between 0.6 percent and 1.7 percent, were among the gainers.
"Rising inflationary pressure along with the prospects of an early rate hike can keep the domestic market on edge as such indicators tempt foreign investors to pump out liquidity from emerging markets like India," said Vinod Nair, Head of Research at Geojit Financial Services.
Data from the US showed consumer prices surged from year-ago levels at the fastest overall pace since 1990 in October. Violently accelerating inflation raises expectations the Federal Reserve will lift key interest rates from record lows more quickly than anticipated earlier.
Volatility prevailed ahead of the expiry of weekly derivative contracts due by the end of the session. NSE's India VIX index -- a gauge of volatility -- rose 0.3 percent to 16.4, having surged as much as six percent during the session.
Technically, the Nifty has respected support at 17,800, said Manish Hathiramani, Proprietary Index Trader and Technical Analyst at Deen Dayal Investments.
The index needs to either break 17,700 or close above 18,100 to break out or break down from its rangebound movement, he said, suggesting a wait-and-watch approach.
Weakness was also visible across broader indices, with the Nifty Midcap 100 and Smallcap 100 falling 0.8 percent and 0.5 percent respectively.
Balkrishna Industries, Laurus Labs, Union Bank, JB Chemicals & Pharma and Birla Corp -- falling between 4.8 percent and 5.7 percent -- were among the top laggards in the midcap and smallcap indices. JSW Energy, Tata Elxsi, Endurance, Quess and Tanla -- up 2.9-5.2 percent -- were among the gainers.
The Godrej Consumer Products stock finished 2.5 percent lower for the day at Rs 952.7 apiece on BSE, after the consumer products maker's quarterly numbers fell short of Street estimates.
Pidilite Industries shares ended 4.5 percent higher at Rs 2,472.9 apiece on the stock exchange as investors cheered the company's strong set of quarterly earnings.
The Tata Steel counter ended nearly unchanged at Rs 1,299 apiece on the bourse ahead of the steelmaker's quarterly financial results.