Sensex Tanks 700 Points: Market Tumble Mirrors Global Sell-off

Mumbai, May 22 (PTI) Stock market benchmark indices Sensex and Nifty tumbled in early trade on Thursday mirroring weak trends in global equities amid the US fiscal worries along with debt concerns.

The 30-share BSE benchmark gauge Sensex tanked 578.3 points to 81,018.33 in early trade. The NSE Nifty declined 203.45 points to 24,610.

Later, the BSE benchmark traded 746.48 points lower at 80,832.82, and the Nifty quoted 233.80 points down at 24,575.65.

From the Sensex firms, Power Grid, Tech Mahindra, HCL Tech, Nestle, Hindustan Unilever, ITC, Tata Consultancy Services and Mahindra & Mahindra were the biggest laggards.

Adani Ports and IndusInd Bank were the gainers.

In Asian markets, South Korea's Kospi, Japan's Nikkei 225 index and Hong Kong's Hang Seng were trading lower while Shanghai's SSE Composite index quoted in the positive territory.

US markets ended sharply lower on Wednesday.

"Nifty rebounded on Wednesday, snapping a 3-day losing streak, but Thursday may see Bears retake control amid global weakness, US debt concerns, rising Covid-19 cases, and overbought technical," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.

Global oil benchmark Brent crude dipped 0.05 per cent to USD 64.88 a barrel.

"The fundamental issue is the high fiscal deficit of the US which the market feels is unsustainable. The weak US 20-year bond auction and the spike in yields of 5-year, 10-year and 30-year bonds indicate the declining confidence in US bonds. Rising US bond yields are usually negative for emerging markets. But the situation is slightly different now. The root cause of the problem is the unsustainable US fiscal deficit and debt," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.

Foreign Institutional Investors (FIIs) turned buyers on Wednesday after a day's breather. They bought equities worth Rs 2,201.79 crore, according to exchange data.

The BSE benchmark jumped 410.19 points or 0.51 per cent to settle at 81,596.63 on Wednesday. The Nifty climbed 129.55 points or 0.52 per cent to 24,813.45.