Sensex Plunges Over 300 Points, Nifty Trades Below 8,200


Sensex fell over 1 percent on Thursday, retreating from a seven-month high hit a day earlier, as caution set in ahead of the U.S. Federal Reserve meeting, while Infosys slumped on worries about its outlook.

Indian shares have outperformed their Asian peers since the end of February as investors bet an improving domestic economy would boost corporate earnings. The BSE has surged around 17 percent during that period compared to about 12 percent for the MSCI’s Asia-Pacific index excluding Japan.

But traders see a more cautious period ahead as the Fed gears up to meet next week, while the U.K. is due to vote on whether or not to leave the European Union later this month.

At home, traders are monitoring the progress of the monsoon, which arrived in southern India on Wednesday, a day later than forecast.

“The market is taking a breather as investors keenly wait for the U.S. Federal Reserve meet next week and the impact of India’s monsoon,” said Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services Ltd.

At of 2.30 p.m., the Sensex was down 1 percent at 26,749, pulling back from its highest since Oct. 29 hit on Wednesday.

The broader Nifty was down 0.86 percent.

Among decliners, Infosys fell 4.43 percent after chief operating officer U.B. Pravin Rao told investors that overall demand for its services remained “volatile.”

Infosys was the biggest percentage loser on both NSE and BSE indexes.

Dr. Reddy’s Laboratories was the top loser on the Nifty pharma index, dropping to its lowest since May 26, after the U.S. Consumer Product Safety Commission charged the drugmaker with having failed to comply with rules on child resistant packaging for five of its products.

The company, however, said it “firmly disagrees with the (U.S.) government’s allegations,” and added it would continue cooperating with U.S. authorities.

Among gainers, oil refiner Bharat Petroleum Corp Ltd rose as much as 2.6 percent after the country’s central bank raised the limit for foreign shareholding in the company to 49 percent.

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