The Nifty50 slumped to the lowest closing level of 2022 on Thursday, as the market extended its losing streak for the fifth day in a row. Weakness across sectors pulled the headline indices lower, with financial, oil & gas, metal and auto stock being the biggest drags.

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Globally, a monthly US inflation reading did little to allay concerns about world economic growth and high interest rates, and continued to hurt the market sentiment.

The Nifty50 nosedived as much as 431.4 points or 2.7 percent during the session before settling at 15,808 for the day — its lowest closing level since July 30, 2021.

The 30-scrip Sensex index fell 1,158.1 points or 2.1 percent to 52,930.3, taking its losses to 2,771.9 points or five percent in five back-to-back sessions.

Investors lost wealth worth Rs 5.4 lakh crore in a day as the market capitalisation of BSE-listed companies dropped to Rs 240.9 lakh crore, according to provisional exchange data.

The HDFC twins, Reliance Industries, ICICI Bank and ICICI Bank contributed more than 600 points to the Sensex's plunge.

All sectoral gauges finished the day in the red.

The Nifty IT recovered almost half of the day's losses as the rupee came within a kissing distance of an all-time low before ending at 77.42 against the US dollar. Weakness in the rupee boosts the profitability of exporters such as IT companies.

Tata Motors shares fell 4.1 percent to Rs 372.1 apiece on BSE as investors awaited the auto major's quarterly results due later in the day.

Punjab National Bank shares closed 13.6 percent lower at Rs 28.6 apiece after the state-run lender reported a set of earnings that missed Street estimates. A surge in slippages affected the bank's profitability.

Broader markets also bled, with the Nifty Midcap 100 and Nifty Smallcap 100 indices down almost two percent each at the close.

The India VIX -- known in market parlance as the fear index -- rose 6.4 percent to 24.4, its highest closing level in seven weeks.

Market expert Ambareesh Baliga sees the possibility of more downside in the market, especially in the midcap and smallcap segments.

"That would be a great buying opportunity because it is a great time for those actually sitting on cash to start buying. But at the same time, they should also have the courage to buy and hold," he told CNBC-TV18.

Global markets

European markets hit a one-and-a-half-year low amid a surge in the US dollar, amid fears that worsening inflation will lead to more aggressive hikes in interest rates and bring the global economy to a standstill.

The pan-European Stoxx 600 index was down 2.2 percent in early hours. S&P 500 futures were down half a percent.

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