Late selling pares early gains

Mumbai: Equity benchmarks capitulated in the last hour of trade on Thursday to break their two-session winning run, with IT, finance and bank stocks playing spoilsport amid expiry of monthly derivatives contracts. A weakening rupee also weighed on sentiment, traders said. After remaining in the positive territory for most part of the session, the 30-share BSE Sensex suddenly came under selling pressure towards the fag-end, tumbling 310.71 points or 0.53 per cent to settle at 58,774.72. Similarly, the broader NSE Nifty dropped 82.50 points or 0.47 per cent to 17,522.45.

"Amid heightened volatility, investors pruned their long positions on the F&O expiry day due to the uncertain global economic scenario. There are concerns that the Federal Reserve Chairman Jerome Powell's speech at the Jackson Hole symposium on Friday would focus on more rate hikes to rein in inflation.

Also, benchmark indices had come close to slipping into negative zone in the last two sessions, and hence correction was on expected lines," said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd. "Ahead of the Jackson Hole symposium, investors across the world are eagerly expecting the Fed chair's speech to evaluate the outlook for monetary policy and determine whether the central bank can achieve a soft landing for the economy.

Crude prices rose as Saudi Arabia suggested that OPEC+ supply may be reduced to address market instability. Although Indian equities are trading at a premium over other emerging markets, the consistent support from FIIs is guiding the domestic market," said Vinod Nair, head (research) at Geojit Financial Services.