Mumbai: Domestic equity benchmark BSE Sensex dropped nearly 200 points in early trade Friday amid heavy foreign fund outflow and weak domestic headwinds.
The 30-share index opened over 150 points tracking rally global equities, but surrendered all gains to trade 201.04 points or 0.52 per cent lower at 38,696.42 at 0955 hours.
The index swung nearly 400 points in the first hour of the session. Similarly, the broader Nifty was also quoting 66.75 points or 0.58 per cent down at 11,530.15.
In the previous session, the 30-share gauge closed at 38,897.46, down by 318.18 points or 0.81 per cent, and the Nifty cracked below the 11,600 mark, ending 90.60 points or 0.78 per cent lower at 11,596.90.
Market opened higher following rally in other Asian equities on reports of two senior US Federal Reserve officials hinting at aggressive rate cuts ahead of the July 30-31 policy meeting.
However, unabated foreign fund outflow, disappointing earnings and reports of slowing economic growth dented market sentiment here, traders said.
"Foreign funds are on a risk-off mode, while domestic mutual funds are providing marginal support in the market," said Vinod Nair, Head of Research, Geojit Financial Services.
On a net basis, foreign institutional investors sold equities worth Rs 1,404.86 crore, while domestic institutional investors purchased shares to the tune of Rs 329.05 crore, provisional data available with stock exchanges showed on Thursday.
Top losers in the Sensex pack included Yes Bank, M&M, Bajaj Finance, Tata Motors, ONGC and Maruti, falling up to 2.27 per cent. On the other hand, Tata Steel, TCS, Vedanta, HUCL, PowerGrid, HCL Tech, HDFC Bank and Infosys gained up to 0.60 per cent.
Shares of index-heavyweight RIL were trading 0.34 per cent lower ahead of its quarterly results, scheduled to be announced later in the day. Hindustan Zinc, Bandhan Bank, Dabur India, RBL Bank, Unitech, L&T Finance Holdings and L&T Technologies are also slated to report June quarter results on Friday.
Meanwhile, the Indian rupee appreciated 18 paise (intra-day) to 68.78 against the US dollar. The global oil benchmark Brent crude futures were trading 1.92 per cent higher at 63.12 per barrel.
Elsewhere in Asia, Shanghai Composite Index, Hang Seng, Nikkei and Kospi were trading over 1 per cent higher in their respective early sessions.
