MUMBAI: Negative global cues, along with profit booking, depressed the Indian equity markets during the mid-afternoon session on Tuesday.
Heavy selling pressure was witnessed in automobile, consumer durables, and IT stocks.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) slipped by 55.65 points or 0.64 per cent to 8,616.50 points.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,190.04 points, traded at 27,983.29 points (at 2.15 p.m.) -- down 169.11 points or 0.60 per cent from the previous close at 28,152.40 points.
The Sensex so far touched a high of 28,199.10 points and a low of 27,942.65 points during the intra-day trade.
The BSE market breadth was tilted in favour of the bears -- with 1,579 declines and 1,007 advances.
On Friday, the benchmark indices had closed with substantial gains on the back of positive global cues, coupled with higher crude oil prices and healthy inflow of foreign funds.
The barometer index had closed higher by 292.80 points or 1.05 per cent, while the NSE Nifty edged up by 80 points or 0.93 per cent.
Initially on Tuesday, the key indices opened on a lower note, in sync with their Asian peers.
Besides, profit booking and lower crude oil prices dampened sentiments.
Further, the downward trajectory got accelerated after macro-economic data which was released during the afternoon session revealed that India's annual rate of inflation based on wholesale prices shot up.
In addition, the July retail inflation data also weighed heavy on investors' sentiments.
The key macro-economic data points, such as the factory output numbers -- Index of Industrial Production (IIP) -- for June and inflation figures for July were released after the market hours on Friday.
The two data points showed that India's annual retail inflation shot up beyond the official tolerance level of 6 per cent for July mainly on higher prices for food articles like pulses and vegetables, while on the brighter side the factory output rose by 2.1 per cent in June.
The Indian equity markets were closed on Monday to mark the Independence Day.
"Profit booking and negative global markets dragged the Indian equity indices lower," Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS.
"As the earning season draws to a close, investors' attention has shifted towards the macros. The recently released CPI data which showed an upward trend has subdued sentiments, as the chances of rate cut has been reduced in the next monetary policy review."
Dhruv Desai, Director and Chief Operating Officer of Tradebulls cited that banking, auto and pharma stocks traded with mixed sentiments on profit booking.
"FMCG stocks also faced profit booking. Sugar stocks traded lower on lack of buying interest at lower levels," Desai said.
"USD/INR futures traded with bearish sentiments. Downside in USD/INR futures prices are likely to support Nifty at lower levels."
According to Nitasha Shankar, Senior Vice President for Research with YES Securities, spike in the WPI and CPI numbers triggered profit booking.
"Broader markets traded on a mixed note. Barring the metal and pharma indices, other sectoral indices traded in the negative zone," Shankar noted.
"IT, auto and realty indices dragged the most."
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