Mumbai: Fears of rising global inflation, along with domestic resurgence of Covid-19 infections, pulled down India's key equity indices on Thursday.
High US bond yields spooked investors, while rising Covid-19 infections in many states led the markets to close in the red for the fifth consecutive session.
In the initial phase of day's trade, both key indices had a gap up opening after the US Fed said that despite a rise in inflation, the growth will be the highest in the nearly 40 years.
The US Fed confirmed no hike in policy rates, which has come as a big positive for the markets globally.
Nevertheless, the rise in bond yields evoked fear in investors, while some sold on the prospects of incoming foreign funds.
The 30-scrip S&P BSE Sensitive Index (Sensex) traded at 49,216.52 points down by 585.10 points, or 1.17 per cent, from its previous close.
The broader 50-scrip Nifty at the National Stock Exchange (NSE) closed in the red too.
It traded at 14,863.30 points, lower by 163.45 points, or 1.11 per cent, from its previous close of 14,557.85 points.
Gold Gains Rs 105; Silver Jumps By Rs 1,073
Gold rose by Rs 105 to Rs 44,509 per 10 gram in the national capital on Thursday, according to HDFC Securities.
In the previous trade, the precious metal had closed at Rs 44,404 per 10 gram.
"Spot gold prices for 24 carats in Delhi were up by Rs 105 reflecting overnight rally in global gold prices," according to HDFC Securities, Senior Analyst (Commodities), Tapan Patel.
Silver also jumped Rs 1,073 to Rs 67,364 per kilogram from Rs 66,291 per kilogram in the previous trade.
Navneet Damani, VP Commodities Research, Motilal Oswal Financial Services, "Gold prices rose after the US Fed in the policy statement yesterday maintained their accommodative stance, hence weighing on the dollar."
After its two-day policy meeting, the US Fed reassured investors that it expects to keep its key interest rate near zero through 2023.
On Thursday's trade, in the international market gold was quoting marginally lower at USD 1,738 per ounce while silver was flat at USD 26.36 per ounce.
"Gold prices traded marginally down with spot prices at COMEX (New York-based commodities exchange) trading at USD 1,738 per ounce on Thursday," Patel added.
Rupee Up By 2 Paise At 72.53 Against US Dollar
The rupee erased some of its initial gains to end 2 paise higher at 72.53 against the US dollar on Thursday, tracking subdued equity market sentiment and a stronger dollar overseas.
Persistent foreign fund inflows and lower crude prices supported the domestic unit, forex traders said.
At the interbank forex market, the local unit opened strong at 72.48 against the greenback but failed to hold on to gains following a massive selloff in the domestic equity markets.
During the session, it witnessed an intra-day high of 72.43 and a low of 72.60. It finally settled 2 paise higher at 72.53 against the American currency. On Wednesday, the rupee had settled at 72.55 against the American currency.
On the domestic equity market front, the BSE Sensex ended 585.10 points or 1.17 per cent lower at 49,216.52, while the broader NSE Nifty dropped 163.45 points or 1.11 per cent to 14,557.85.
The dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.24 per cent to 91.65.
Brent crude futures, the global oil benchmark, fell 0.35 per cent to USD 67.76 per barrel.
Foreign institutional investors remained net buyers in the capital market as they bought shares worth Rs 2,625.82 crore on Wednesday, according to exchange data.
This story is a compilation of 1 IANS story and 2 PTI stories)