Mumbai: A sense of anxiety prevailed in the market as the Sensex on Tuesday slumped 194 points ahead of the budget — to be presented on Wednesday — to a one-week low of 27,656 and the Nifty slipped below 8,600 after the Economic Survey projected a lower growth of 6.5 per cent for 2016-17.
The recently introduced immigration restrictions by US President Donald Trump and the new legislation that aims to rework the H1-B visa programme dealt a blow to IT stocks, which saw a big fall.
TCS, Wipro and Infosys dropped by up to 4.47 per cent, dragging down the BSE IT index by 2.96 per cent, followed by technology that tanked 2.49 per cent.
The Economic Survey for 2016-17, tabled in Parliament by Finance Minister Arun Jaitley on Tuesday, underscored the need for more reforms. Its GDP growth forecast for this fiscal is lower than the 7.1 per cent put out by the Central Statistics Office earlier this month.
The Sensex closed down 193.60 points, or 0.70 per cent, at 27,655.96, its lowest closing since January 24 when the figure was 27,375.58. It had lost 33 points in the previous session.
The broad-based NSE Nifty, which hit a low of 8,552.40 intra-day, managed to cut down losses and ended lower 71.45 points, or 0.83 per cent, at 8,561.30.
The risk-averse behaviour was on display as participants took cues from global stocks that remained on the backfoot following Trump’s controversial crackdown on immigration.
“The Economic Survey failed to impress investors who opted for keeping their commitments at a low ebb and wait for the the budget,” said Manoj Choraria, a Delhi-based stock broker.
GAIL, Adani Ports, Sun Pharma, Tata Motors, Coal India, Lupin, Axis Bank and NTPC were among those that weighed.
Sectoral indices such as oil and gas (1.64 per cent), PSU (1.39 per cent), healthcare (1.38 per cent), infrastructure (1.31) per cent and metal (1.01 per cent) all turned weak.
Selling activity also extended to the broader markers, with the BSE midcap falling 1.10 per cent and the smallcap 1.03 per cent.
According to provisional figures, foreign investors bought shares worth Rs 607.36 crore yesterday.
There were a few that went up cushioning the fall, which include ITC, PowerGrid, Bajaj Auto, ONGC and HDFC Bank.
In Asia, most markets were closed on Tuesday for a public holiday. Japan’s Nikkei ended lower by 1.69 per cent.
European markets, however, were trading higher as major indices in France, Germany and the UK moved up.
“This gives an alert that tomorrow’s budget could also be a measured one,” said Nair.
The US Fed rate decision on Wednesday ensured investors remained risk averse throughout the day.
The market breadth turned negative as 1,897 stocks ended lower, 828 closed higher while 220 ruled flat.
The total turnover on BSE read Rs 3,204.94 crore, higher than Rs 2,684.90 crore during the previous session.