Indian equity benchmarks suffered sharp losses on Wednesday tracking weakness across global markets, with financial, IT and oil & gas shares being the biggest drags. Globally, concerns persisted on steep hikes in COVID-era interest rates and resilience of the world economy, as investors awaited the release of the Fed's Beige Book — which summarises the state of the world's largest economy — due later in the day.

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NSE

The Sensex fell as much as 474.1 points or 0.8 percent to 58,722.9 in the first few minutes of trade and the Nifty50 slid to as low as 17,484.3, down 171.3 points or one percent from its previous close.

Barring three stocks, all of the Nifty50 constituents fell at the open. Hindalco, Eicher Motors, IndusInd Bank, HDFC Bank and Mahindra & Mahindra were the top laggards.

HCL Tech, Tech Mahindra, HDFC, Larsen & Toubro and Infosys — falling more than one percent each — were also among the worst hit blue-chip stocks.

Coal India, on the other hand, edged up 0.1 percent.

Infosys, HDFC Bank, ICICI Bank, Bharti Airtel and Reliance were the biggest contributors to the losses in both headline indices.

All sectors on Dalal Street started the day in the red, with the Nifty IT and Nifty Bank indices being among the top losers.

"There are near-term strong headwinds for risky assets globally. Bonds are in a strong bear market. The 10-year US bond yield at 3.34 percent and dollar index above 110 are strong headwinds for capital flows to emerging markets like India," said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"FPIs are buying in the cash market but hedging through increasing short positions in derivatives... When globally equities correct, India too will correct. But India will fall less since falling crude, decent economic growth, impressive corporate earnings and retail investor enthusiasm will support the market at lower levels," he added.

Foreign portfolio investors (FPIs) purchased Indian shares worth a net Rs 1,145 crore on Tuesday, according to provisional exchange data. That was in line with the trend in much of August — the first month of FPI inflows for Dalal Street since September 2021.

Overall market breadth was in favour of the bulls, as 1,943 stocks rose and 1,149 fell on BSE.

Global markets

Equities in other Asian markets tanked on Wednesday tracking a weak session overnight on Wall Street, where investors returned to trade after the Labor Day holiday. MSCI's broadest index of Asia Pacific shares outside Japan was down 1.2 percent at the last count. Japan's Nikkei 225 was down one percent.

S&P 500 futures were down 0.5 percent. On Tuesday, the three main US indices each finished a volatile session around half a percent lower.

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