Stock market closing: Nifty, Sensex end 1% lower; tech shares decline most

The domestic markets ended one per cent lower amid Fed meeting update and FIIs selling pressure on Thursday. Benchmarks Nifty and the Sensex corrected 2 per cent in the afternoon trade as the Fed hinted at raising US interest rates in March and warned that inflation remains above the Fed`s long-run goal and supply chain issues may be more persistent than previously thought.  

The benchmarks made last moment recovery as the indices trimmed losses to end above 17, 100 and near 57, 300 on Thursday. The broader Nifty settled at 17,110.15, down 167.80 points or lower by 0.97%, while the Sensex declined 1 per cent or 581.21 points to end at 57,276.94 on the monthly derivatives contract expiry day.  

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Sectorally, buying interest was seen in banking, media and auto shares as all other sectors traded in the negative.  

Axis Bank, State Bank of India, Maruti, Cipla, Kotak Bank, IndusInd Bank and Sun Pharma were among the gainers as the stocks provided much support to the benchmarks in a falling market.  

IT shares were the top drags even on Thursday as TCS, Infosys, HCL Technologies, Tech Mahindra, Wipro were among those to lose maximum on Thursday. Dr Reddy's Laboratories, Titan, Nestle Indian and Powergrid were other losers on Thursday.  

Market expert is of the view that the fall in the Indian markets is in line with global markets as the markets were eagerly waiting for the outcome of the US Federal Reserve meeting. "The Federal Reserve has indicated that they will begin hiking interest rates in the near future and that there will be multiple rate hikes this year. The Fed also stated that they will end the asset purchase program in March and will also look to reduce the size of the Fed Balance Sheet from sometime later this year. The combination of these measures is what has spooked markets globally," said Sameer Kaul – MD & CEO, TrustPlutus Wealth. 

He said Fed decision means moving from a scenario of easy and excess liquidity to a scenario of liquidity tightening. "As stated earlier, we expect 2022 to be a much more challenging year from a returns perspective as compared to 2021. We suggest investors stick to their asset allocation and invest in high quality companies and also pay close attention to valuations," he added.