The joy of Fed ditching the word patience in its commentary was shortlived. The indices got off to a sparkle of a start but succumbed to profit booking across the board. The market cracked heavily especially in the last hour of trades. Banking stocks and select index heavyweights like Reliance Industries and ITC were on the sellers list. The Sensex ended 152 points lower, while the Nifty shed 51 points.
Amar Ambani, Head of Research, IIFL, said, "Indices erased all its early gains on account of heavy offloading in the banking, capital goods and the realty stocks. Even the mid-cap and the small-cap stocks were not spared. Markets did open with strong gains after the Federal Reserve signaled cautious end to near-zero interest rates. Moving forward, we expect 8470 to prove to be an important support zone for Nifty."
The trio private banking majors - HDFC Bank, Axis Bank and ICICI Bank along with ITC and Reliance Industries accounted for a loss of 132 points on the BSE index.
Earlier in the day, the Sensex opened with a positive gap of 183 points at 28,805, and rallied to a high of 28,979 tracking the positive overseas cues as the US Federal Reserve signaled that it will not raise interest rates any time soon. Also the rates hikes could be gradual in nature. Yellen said, that by removing the word 'Patient' it does not mean Fed will be 'Impatient' in its stance.
The US Federal Open Market Committee (FOMC) stated that, an increase in the target range for the federal funds rate remains unlikely at the April FOMC meeting. FOMC will assess progress - both realized and expected - toward its objectives of maximum employment and 2 per cent inflation to decide on how long to maintain this target range.
This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments, the release added.
Incidentally, the banking shares which led the rally in the morning deals, were the first to correct on account of profit-taking at higher levels. Heavy sell-off in the last one-hour also saw banking shares bear the brunt of the selling pressure.
The Sensex from a high of 28,979, consolidated around 28,800-odd level for the better part of the day before falling apart. So severe was the selling pressure that the BSE index plunged to a low of 28,412 - down 567 points from the day's high. The Sensex finally ended with a loss of 152 points at 28,470.
The NSE Nifty tumbled 173 points in intra-day deals, from a high of 8,788 the index plunged to a low of 8,615 before settling with a loss of 51 points at 8,635.
The India VIX (Volatility) index declined by 2 per cent to 15.1975.
The broader market also ended in red. The CNX Midcap index was down 0.4 per cent at 13,207, and the Smallcap index shed 0.7 per cent at 5,684.
The breadth too was fairly negative at close, with around two declining stocks for every advancing share. Out of 1,711 stocks traded on the NSE, 986 declined and 499 advanced today.
Among sectors, the Bank Nifty cracked by 3.3 per cent in intra-day deals. The Bank Nifty from a high of 19,373, tumbled to a low of 18,740, and ended with a deep cut of 1.8 per cent at 18,811.
Punjab National Bank was the major loser in the banking space, down over 4 per cent at Rs. 162. Bank of Baroda and Axis Bank also plunged nearly 4 per cent each to Rs. 175 and Rs. 560, respectively.
Yes Bank shed 3.3 per cent at Rs. 827. Canara Bank, IndusInd Bank and Bank of India declined around 2.5 per cent each. SBI, Kotak Bank, ICICI Bank and HDFC Bank were down 1-2 per cent each.
The CNX Infra and Metal indices were down 0.7 per cent each at 3,242 and 2,388, respectively. The Pharma index which was up over 2 per cent for most part of the trading day also pared gains and ended with a marginal gain of 0.5 per cent at 12,800.
Lupin rallied to a fresh all-time high at Rs. 1,959, and finally settled nearly 3 per cent higher at Rs. 1,927.
Asian Paints gained 2.5 per cent at Rs. 835, and Gail India advanced over 2 per cent to Rs. 390.
TCS and NTPC were up around 1.5 per cent each at Rs. 2,602 and Rs. 155, respectively.
ONGC, Tata Steel, NMDC and HDFC were the other notable gainers.
On the other hand, other than the banking stocks - BPCL was the major loser, down 2.8 per cent at Rs. 751 on account of profit-taking.
HCL Technologies shed 2.7 per cent at Rs. 977 on going ex-bonus. The company had announced a 1:1 bonus issue, and fixed 20 March as the record date for ascertaining eligible shareholders for the bonus shares.
BHEL, IDFC and Grasim dropped 2 per cent each to Rs. 253, Rs. 166 and Rs. 3,600, respectively.
Tech Mahindra also declined nearly 2 per cent to Rs. 687 after been adjusted for the bonus-cum-split. The company had fixed 20 March, 2015, as the record date for its 1:1 bonus issue and 2:1 stock split, each stock with the face value of Rs. 10 to be sub-divided into two equity shares of Rs. 5 each.
UltraTech Cement, Reliance Industries, Zee Entertainment, Sesa Sterlite, Tata Motors and ITC were the other major losers.
Larsen & Toubro (L&T) had rallied to a high of Rs. 1,739 in early morning trade on securing fresh contracts worth Rs. 1,255 crore. The stock, however, plunged into red and ended 1.4 per cent lower at Rs. 1,675.
Among other stocks, debutant Ortel Communications had a poor listing, just like the lukewarm response to its IPO. The company's IPO was subscribed 0.75 times, and the issue price was fixed at Rs. 181, with stock to be listed under the 'T' group on the BSE. The stock today touched a high of Rs. 181, and settled with a 5 per cent discount at the day's low of Rs. 172. The counter has saw trades of mere 2,960-odd shares on the BSE.
KPIT Technologies extended losses for the third straight day after the company cut its outlook for Q4FY15 due to significant negative cross currency impact. The stock today plunged over 6 per cent to Rs. 181, and has now slumped over 14 per cent in the last three days.
Wockhardt soared to a high of Rs. 1,908 after the company said that the US health regulator has not found any issues with respect to data security and control measures at Chikalthana plant in its recent inspection. The stock however ended 1.5 per cent higher at Rs. 1,908.
Reliance Infrastructure surged to a high of Rs. 468, before settling flat at Rs. 454 on news report that the company is to bid for military chopper contracts worth over $ 3 billion.
Thomas Cook rallied to a high of Rs. 216 on announcing its plans of possible IPO for its subsidiary - Quess Corp. The stock ended 0.8 per cent higher at Rs. 209.
Hester Biosciences was locked at the 10 per cent upper circuit at Rs. 485 on the back of launching its PPR (Peste Des Petits Ruminants) vaccine and Goat Pox vaccine. According to a release issued by the company to the BSE, the PPR vaccine is to be given annually to sheep and goats. PPR disease causes dysentery and death of the animal.
ITD Cementation India was also locked at the 10 per cent upper circuit at Rs. 771 on reports that the stock will be included in the CNX 500 index from 24 March onwards.
Credit Analysis and Research (CARE) Ratings advanced 2.5 per cent to Rs. 1,525 after Life Insurance Corporation of India (LIC) acquired about 10 per cent stake in the company for Rs 418 crore through open market deals.
RPG Life Sciences zoomed to a fresh life-time high at Rs. 137 on the back of heavy volume at the counter.
A total of 38 stocks registered a fresh 52-week high today. Prominent among these were stocks like - Aurobindo Pharma, Bosch, Dabur India, Elecon Engineering, Gillette India, GSK Healthcare, Hitachi Home and Life Solutions, HSIL, Kalyani Investment Company, KRBL, Kaveri Seed Company, Lupin, Lyka Labs, Mangalam Drugs, NCC, Page Industries, PC Jeweller, Pidilite Industries, Rajesh Exports, Ramco Systems, Ranbaxy Labs, RPG Life Sciences, Shasun Pharma, Signet Industries, Sita Shree Food Products, Strides Arcolab, Sun Pharma, Triveni Turbine, Vishnu Chemicals, WABCO India, Wanbury, Wockhardt and Zydus Wellness.
Amtek India, Anant Raj, Aptech, Arvind Remedies, Autoline Industries, Bhushan Steel, Dwarikesh Sugar, Elder Pharma, Globus Spirits, GTL, Indian Metals & Ferro, Jai Corp, Jayshree Tea, Jindal Cotex, Jyoti Structures, Man Industries, Mold-Tek Packaging, NEPC India, Oil Country Tubular, Peninsula Land, Phoenix Lamps, Shree Renuka Sugars, Sterling Biotech, Thiru Arooran Sugars, Uttam Galva Steels, Varun Shipping, Venus Remedies and Zylog Systems were in a list of 52 stocks to hit a fresh 52-week low.