Indian equity benchmarks suffered sharp losses on Wednesday, declining for a second straight day after a rally that lasted seven trading sessions. Weakness across sectors, led by automobile, metal, fast moving consumer goods, pharma and consumer durable shares pulled the market lower.
The Sensex index ended 456.1 points or 0.7 percent at 61,260 and the broader Nifty50 benchmark shed 136.5 points (0.7 percent) to settle at 18,282.3.
Hindalco, BPCL, Titan, Bajaj Finserv, Hindustan Unilever and UPL -- ending between 2.3 percent and 3.9 percent lower -- were the worst hit among the 39 laggards in the Nifty50 universe.
On the other hand, Bharti Airtel, SBI, Tata Motors, IndusInd Bank and Adani Ports -- closing between 0.6 percent and four percent higher -- were among the gainers.
Broader markets also tumbled, as the midcap and smallcap indices fell more than two percent each.
IRCTC, Deepak Nitrite, Dixon, Balaji Amines and DCM Shriram -- closing between 7.1 percent and 19.1 percent lower -- were among the top laggards in the midcap and smallcap indices. Vodafone Idea, Union Bank, BHEL, Mazagon Dock and Sterlite Tech -- rising between 4.1 percent and seven percent -- were among the top performers.
"The ongoing market correction is not an overreaction and can sustain in the near-term due to high valuations. However, in the future, Indian corporates will benefit from the reforms and China Plus One strategy," said Vinod Nair, Head of Research at Geojit Financial Services.
However, he also said that the long-term trend of the market remains intact due to further reopening of the economy, the low interest rate cycle, and fiscal as well as private spending.