The Indian equity benchmarks moved sharply lower on Thursday, ahead of monthly expiry of January futures and option contracts, on the back of weak global markets after the Federal Reserve's chairman signaled plans to steadily tighten policy. The Sensex fell as much as 1,048 points and Nifty 50 index dropped below its important psychological level of 17,000 at the day's lowest level.
As of 9:23 am, the Sensex was down 833 points or 1.44 per cent at 57,025 and Nifty 50 index dropped 242 points or 1.4 per cent to 17,035.
Asian shares fell to their lowest in more than 14 months, short-term U.S. yields rose to 23-month highs and the dollar strengthened on Thursday, news agency Reuters reported.
Rising investor concerns over political tensions between Russia and Ukraine exacerbated worries over tight energy market supply, keeping oil prices elevated at multi-year highs.
In its latest policy update on Wednesday, the Fed indicated it is likely to raise U.S. interest rates in March, as has been widely expected, and reaffirmed plans to end its bond purchases that month before launching a significant reduction in its asset holdings.
Back home, HDFC Bank, Infosys, Reliance Industries, HDFC, ICICI Bank, Tata Consultancy Services, Bajaj Finance and Titan were among the top drags on the Sensex, data from BSE showed.
Selling pressure was broad-based as all the 15 sector gauges, barring the measure of state-run banking shares, were trading lower led by Nifty Information Technology index's over 2 per cent declines. Nifty Pharma, Bank, Consumer Durables, Healthcare, Realty, Private Bank, Metal, FMCG and Financial Services indices also fell between 1.2-2.5 per cent.
Mid- and small-cap shares were also facing selling pressure as Nifty Midcap 100 index declined 1.6 per cent and Nifty Smallcap 100 index fell 0.61 per cent.
Titan was top Nifty loser, the stock fell nearly 4 per cent to Rs 2,286. Tata Steel, Bajaj Finserv, Wipro, Dr Reddy's Labs, HCL Technologies, Bajaj Finance, JSW Steel, HDFC, Grasim Industries and Eicher Motors also fell between 2.5-3 per cent.
On the flipside, ONGC and Maruti Suzuki were among the notable gainers.
The overall market breadth was extremely negative as 1,950 shares were declining while 904 were advancing on the BSE.