Sensex drops 118 points, tumbles to 6-1/2 months low

Mumbai: Falling for the third-straight day, the benchmark BSE Sensex on May 7 tumbled 118 points to end at 6-1/2 months low of 26,599.11 on persistent selling by foreign investors over taxation worries and delay in passage of key reform bills. Investor sentiment was also dampened after weakening of rupee to a 20-month low (intra-day) faded chances of a rate cut by the RBI at its meeting next month, brokers said.

Global cues, unsettled by sell-off in government bonds, stocks and dollar, also weighed on sentiments, they added. All the major indices in Asia ended lower, while those in Europe were in the red in their early trade. "Market continues its consolidation with continuing FII outflows. Q4 earnings are impacting the market sentiments on FY16 outlook and hence the current consolidation could prevail until the extend of downgrading FY16E earnings is understood," said Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services.

The 30-share Sensex on May 7 fell 118.26 points or 0.44 per cent to close at 26,599.11, its weakest closing since October 21, last year. The gauge shuttled between 26,423.99 and 26,850.37 intraday. Today is the third straight session of decline with the index having lost 891.48 points in this period. The NSE Nifty index also ended with a loss of 39.70 points or 0.49 per cent at 8,057.30 - its weakest close since December 17 last year. Intra-day, it dipped below the crucial 8,000-level to touch a low of 7,997.l5. Meanwhile, the Sensex has retreated by 3,425.63 points or 11.40 per cent from record high of 30,024.74 reached on March 4, while Nifty plunged 1,061.90 points or 11.64 per cent from its record high of 9,119.20 touched on March 4.

Axis Bank was the biggest loser among 30-Sensex stocks by plunging 2.95 per cent followed by ONGC down 2.94 per cent to Rs 318.70. Other losers were Maruti Suzuki with a fall of 2.52 per cent, Hindalco down 2.47 per cent, ICICI Bank 2.44 per cent, Tata Power 2.32 per cent, Dr Reddy's 2.19 per cent and Tata Motors 1.90 per cent. Bucking the trend, TCS, Wipro and Infosys ended logged gains, largely supported by weakening rupee. The broader markets remained under pressure with the BSE midcap and smallcap indices falling up to 1.95 per cent.