Sensex drops 135 points to close at 37,848 after IMF cuts India's growth outlook, Nifty slips below 11,300-mark

Mumbai: Equity benchmarks racked up losses for the fifth straight session on Wednesday as risk sentiment remained fragile after IMF slashed India's growth outlook.

The 30-share BSE Sensex tumbled 135.09 points or 0.36 percent to close at an over two-month low of 37,847.65. Similarly, the broader NSE Nifty dropped 59.75 points or 0.53 percent to 11,271.30.

This has been the longest losing streak for the indices since early May. The Sensex has now lost 1,367.99 points in five sessions, while the Nifty has shed 416.20 points.

With the markets already grappling with unabated foreign fund outflows and tepid corporate earnings, IMF's downward revision of India's economic outlook further hit domestic investor sentiment, traders said.

 Sensex drops 135 points to close at 37,848 after IMF cuts Indias growth outlook, Nifty slips below 11,300-mark

Representative image. Reuters

The IMF on Tuesday projected a slower growth rate for India in 2019 and 2020, slashing its forecast by 0.3 percentage points for both years at 7 percent and 7.2 percent respectively, reflecting a weaker-than-expected outlook for domestic demand.

Top losers in the Sensex pack on Wednesday included IndusInd Bank, Bajaj Finance, Tata Motors, Tata Steel, Hero MotoCorp, Axis Bank, M&M, Vedanta and Maruti, falling up to 3.50 percent.

On the other hand, Asian Paints was the biggest gainer, rallying 3.42 percent, after the company reported an 18 percent increase in consolidated net profit for the June quarter.

HUL, HDFC twins, HCL Tech and ITC too ended in the green, spurting up to 2.06 percent.

"Investors turned sellers on concerns that the economy is moving through a slowdown phase. IMF lowered GDP growth forecast by 30 bps for 2019 based on weak domestic demand outlook which fuelled a sell-off in a market where sentiment is already hurt due to tax concerns.

"Mixed Q1FY20 results, the outflow of foreign funds and weakening rupee to weigh on investor sentiments going ahead," said Vinod Nair, Head of Research, Geojit Financial Services.

Sectorally, the BSE metal, auto, basic materials, oil and gas, industrials, realty, telecom, power and energy indices fell up to 2.48 percent.

FMCG was the sole gainer, adding 0.17 percent.

The broader BSE midcap and smallcap indices plunged up to 1.48 percent.

On a net basis, foreign institutional investors sold equities worth Rs 2,607.97 crore on Tuesday, while domestic institutional investors purchased shares to the tune of Rs 2,625.10 crore, provisional data available with stock exchanges showed.

Global markets were mixed as participants digested a slew of corporate results and macro data.

In Asia, Shanghai Composite Index, Hang Seng and Nikkei ended higher, while Kospi settled in the red. Bourses in Europe were trading on a mixed note in their early sessions.

On the currency front, the Indian rupee depreciated marginally to 68.99 against the US dollar (intra-day).

Meanwhile, the global oil benchmark Brent crude futures rose 0.22 percent to $63.97 per barrel.

Updated Date: Jul 24, 2019 18:01:34 IST