The domestic benchmarks ended sharply lower on Friday, snapping their three-session-long gaining streak, as weak global cues and record spike in the U.S. inflation data fuelled fears of aggressive rate hikes by the Federal Reserve. The sustained fund outflow by foreign institutional investors (FIIs) in the backdrop of rising U.S. bond yields and crude prices also dented market sentiments.

Ending three-session gains, the BSE Sensex closed 773 points, or 1.3%, lower at 58,153, and the NSE Nifty dropped 231 points, or 1.3%, to 17,375.

In a similar fashion, the broader markets also ended sharply lower. The S&P BSE Midcap index tumbled 1.84%, and the S&P BSE Smallcap index plunged 1.9%.

The overall market breadth on the BSE was negative, with 2,498 shares falling out of a total of 3,671 traded stocks. As many as 1,047 shares advanced and 126 were unchanged.

Top gainers and losers

The top loser on the BSE Sensex pack was IT major Tech Mahindra, which ended 2.94% lower. Some of the other top laggards include Infosys, HCL Technologies, Kotak Mahindra Bank and UltraTech Cement, which dropped up to 2.7%.

Out of the top 30 shares on the BSE Sensex pack, 25 heavyweights closed lower, while the remaining settled in positive terrain. The top gainer on the BSE Sensex pack was private sector lender IndusInd Bank, which closed 0.94% higher. The other notable gainers were Tata Steel, NTPC, Mahindra & Mahindra and ITC, which rose up to 0.5%.

All sectors end in red

On the sectoral front, all indices ended in red, while IT and tech stocks declined the most. The BSE IT index was the biggest loser as it fell 2.55% lower. The biggest losers in IT space today were Persistent Systems, 3i Infotech, Larsen & Toubro Infotech, Intellect Design Arena and Kellton Tech Solutions.

The oil and gas sector was the best performer, led by gains in Petronet LNG, Indian Oil Corporation, Indraprastha Gas, and Hindustan Petroleum Corporation Ltd. (HPCL).

Strong U.S. inflation data rattles global equities

Shares in the Asia-Pacific region and in Europe traded mostly lower on Friday as higher-than-expected U.S. inflation data rattled global equities. Adding to the woes, hawkish comment from a Federal Reserve official further stoked fear of aggressive interest rate hikes by the central bank.

In the Asia-Pacific region, Hong Kong’s Hang Seng index ended tad lower, while South Korea’s KOSPI plunged 0.9%. Australia’s ASX 200 index plunged 1%, Thailand’s SET Composite fell 0.2%, and Taiwan Weighted index slipped 0.15%.

In mainland China, the Shenzhen Component nosedived 1.55%, while the Shanghai Composite closed 0.66% lower.

In European market, Germany’s DAX dropped 1% in early deals, while France’s CAC index fell 1.4%. The U.K.’s FTSE 100 index tumbled 0.8%, while Spain’s IBEX index shed 1.15%.

In the overnight trade, all three major U.S. indices closed lower as investors reacted to labour department data that showed consumer prices surged 7.5% in January, registering the biggest annual increase in inflation since 1982. Reacting to inflation data, the Nasdaq Composite ended 2.1% lower, the Dow Jones Industrial Average fell 1.5%, and the S&P 500 tumbled 1.8%.

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