Sensex, Nifty settle lower; rupee breaches 69-mark again

The Sensex and Nifty ended lower on Thursday, a day ahead of a no-confidence motion against the government, dragged by financial stocks such as Kotak Mahindra Bank. A depreciating rupee, which again breached the 69-mark against the dollar in intra-day trade, too weighed on sentiment. 

Sensex ended at 36,351, down 22.21 points, while Nifty50 settled at 10,957, down 23.35 points. In the broader market, the BSE Midcap index and the BSE Smallcap index underperformed to lose 0.6 per cent and 1 per cent, respectively.

Market breadth, indicating the overall health of the market, turned sharply negative. On the BSE, 1,754 stocks declined, 827 stocks rallied, while 146 stocks remained unchanged.

Kotak Mahindra Bank closed 3.7 per cent lower after it reported a smaller-than-expected profit for the quarter ending June. Aluminium producer Hindalco Industries, which slumped to a one-year low in the session, ended 7 per cent weaker.

"Market was rangebound with a negative bias due to weakening rupee on account of surge in dollar index and ongoing trade spat. Global cues are not clearly supporting domestic market direction. Trade tensions between US and other major economies are keeping investors on edge. Mid and small cap continued to underperform due to volatile rupee while PSU banks gained in expectation of govt’s recapitalisation measures," said Vinod Nair, Head of Research, Geojit Financial Services. 

Meanwhile, domestic institutional investors (DIIs) bought shares worth a net of Rs 111.01 crore, while foreign portfolio investors (FPIs) bought shares worth Rs 95.68 crore yesterday, provisional data released by stock exchanges showed.  

Overseas, Asian shares had struggled following the moves and Europe’s bourses were also in the red as traders banked some of the recent gains that had hoisted the STOXX 600, the DAX and the CAC40 to 1-month highs.

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Oil and gold also dropped again. Gold hit another one-year low of $1218.34 per ounce, while Brent and WTI US crude futures were down 80 and 53 cents at $72.10 and $68.20 a barrel respectively.

Brent has fallen almost 9 per cent from last week’s high above $79 on emerging evidence of higher production from Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries as well as Russia and the United States.

(With inputs from Reuters)